The UK defence sector is set for huge growth heading into 2025, underpinned by Labour’s recent budget announcement and new project launches focused on modernisation and security resilience.
In 2024, defence spending saw a rise with an additional £1.1 billion allocated to key areas such as munitions and digital transformation, aiming to hit the long-term target of 2.5% of GDP dedicated to defence funding.
Labour’s budget commits to steady, phased investment, prioritising technology innovation, cybersecurity, and key international partnerships to bolster the UK’s standing within NATO and beyond.
As we look to 2025, several project announcements and strategic focus areas promise to drive further industry expansion:
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Project Announcements and International Partnerships:
Key projects include the AUKUS partnership with the U.S. and Australia, which advances the UK’s submarine capabilities and tech transfer. Additionally, the reinforced commitments to NATO, focusing on enhancing collective security efforts, which will create opportunities across engineering, cyber operations, and support roles. -
Modernisation Focus:
The 2024 Strategic Defence Review (SDR) has directed funds towards advanced technology, aiming to incorporate AI, robotics, and other digital transformation initiatives to make the UK defence sector more resilient. This investment is expected to drive demand for digital skills, cybersecurity expertise, and advanced manufacturing capabilities, helping the UK respond to evolving global threats. -
Workforce Growth and Talent Demand:
Labour’s budget also addresses talent acquisition and retention within the defence sector. With a renewed focus on workforce inclusivity and competitive pay, hiring demand should increase for roles in cybersecurity, data science, engineering, and other technical areas critical to modern defence.
These focused investments and partnerships signify strong momentum for the UK defence industry as it enters 2025, shaping a sector that not only safeguards national interests but also drives economic growth and innovation.
What do these predictions for the defence sector mean for you?
Defence Employers:
The UK defence sector's growth trajectory in 2025 offers significant opportunities for employers. To capitalise on the sector’s growth, employers should focus on talent acquisition strategies that attract and retain top talent, invest in employee development and upskilling programmes, and foster a culture of innovation and collaboration.
Defence Candidates:
The UK defence sector's expansion in 2025 presents a wealth of career opportunities for individuals with the right skills and qualifications. Roles in cybersecurity, artificial intelligence, robotics, and advanced engineering are expected to be in high demand.
To position yourself for success, consider pursuing certifications, upskilling in emerging technologies, and networking with industry professionals. Additionally, explore opportunities within both traditional defence organisations and private sector companies involved in defence contracts and supply chains.
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Emma Homann, Engineering & Technology Consultant