Competitive Advantage Turned Bottleneck in Britain’s New Defence Boom

By Olivia Ediri

Amid the aircraft and arms deals dominating headlines from this year’s Farnborough International Airshow, one announcement should not be missed: Babcock and the University of Oxford joint study, “Engineering the Future of Defence,” to examine how engineering education needs to change to meet the demands of a rapidly expanding UK defence sector. It is a direct response to a problem the government’s own Strategic Defence Review has already flagged as a genuine threat to delivery: Britain does not currently have enough engineers to build what it is now committing to build. 

The numbers behind that gap are stark. Industry research produced with Defence Online found that 48% of defence employers report a shortage of engineering skills specifically, alongside shortfalls in cyber and digital (33%) and manufacturing (25%). Separate analysis puts the sector’s annual talent deficit at roughly 10,000 positions. The Strategic Defence Review itself notes that Regular Armed Forces numbers have been down 8% since 2022, with technical shortages compounding the problem across both military and civilian defence roles. 

The government has committed to raising defence spending to 2.5% of GDP by April 2027, established a Defence Growth Board explicitly tasked with turning Britain into a “defence industrial superpower,” and in June announced £80 million to expand defence-focused education across 24 universities and colleges in England, including funding for 2,500 additional university places over five years in subjects the sector is short on. 

Defence capital is moving faster than the systems meant to sustain it. Political will and capital can be mobilised in a budget cycle, but skills cannot. The Babcock-Oxford study is not only asking how to train more engineers faster, but how curricula, universities, and training providers need to fundamentally adapt to keep pace with demand for skills in AI, autonomous systems, cyber, and advanced manufacturing that did not feature in defence engineering courses a decade ago. 

Farnborough itself is part of that answer, whether the industry names it that way or not. Alongside the exhibition halls this year ran STEM programme, fully staffed careers hubs, and free entry for under-21s on the show’s final day, a deliberate effort to put the next generation of engineers in front of the industry years before a graduate recruiter ever will. An airshow cannot close a 10,000-person annual deficit on its own. But it is one of the few moments the entire sector, primes, SMEs, the MoD, universities and training providers, are in the same place at the same time, actively building the pipeline that the Babcock-Oxford study is now trying to turn into a formal strategy. 

This bottleneck matters beyond the UK’s own balance sheet. Countries actively courting British defence partnership, including a fast-growing African defence market where spending already exceeds $50 billion annually and is projected toward $109 billion by 2031. The UK’s real comparative advantage in those relationships was not simply its hardware or its contracts. It is decades of exactly the kind of engineering pipeline the Babcock-Oxford study now suggests is no longer keeping pace with demand. 

That advantage is not permanent by default. It was built, deliberately, over a long enough period that it now looks like background infrastructure. The current shortage is a test of whether Britain treats that pipeline as something to actively maintain, or something to assume will simply keep producing engineers because it always has.  

The Babcock-Oxford study is an attempt to work out what is required to close the gap. Whether that translates into a workforce capable of matching the money now flowing into the sector is a question the government and industry must answer.

Editor's note:

Olivia Ediri is a Strategy Associate at Penta Group, working across strategic advisory and intelligence for FTSE 100 defence clients.