Plenty of developed countries have compulsory military service (South Korea, Israel, Switzerland). If anything, we're lucky that it's a choice.
I recommend the Wikipedia articles about "Conscription in <insert country here>".
a) People conscripted to serve in the military.
b) People who choose civilian service to avoid military service.
c) Conscientious objectors who go to prison instead of serving.
d) People who could be conscripted but somehow manage to avoid serving.
From my Finnish perspective, "mandatory military service" means that the ratio (a + b + c) / d is high. Civilian service does not exist because the country wants to use slave labor instead of paid labor, but because it's socially more acceptable than imprisoning people who refuse to serve in the military.