The employment estimate, published in the UK Defence Footprint 2026 report, covers spending announced in the Defence Investment Plan and measures growth by 2029–30 against 2023–24 levels. The £298 billion represents total planned defence expenditure over four years.
The report links procurement for the armed forces with efforts to expand Britain’s industrial capacity and increase exports. It identifies Dreadnought submarines, the Future Combat Air System and directed energy weapons as programmes offering opportunities for overseas sales, commercial applications and dual-use technology.
Domestic orders alone will not sustain industry
The ministry acknowledges that British military demand cannot support the full industrial base the country needs. Export orders and international partnerships are therefore central to its plans for maintaining production capacity and skilled employment.
“UK demand alone will not sustain the size and scale of defence industrial base we need for our national security,” the report states. It describes exports as supporting both Britain’s security relationships and the companies supplying its armed forces.
MOD spending with UK-based industry reached £34.1 billion in 2025–26, up 3% from the previous year. Separate employment estimates show that its expenditure supported 274,000 industry jobs in 2024–25, an increase of 10%.
The ministry placed more than 2,000 new contracts in 2025–26, including over 500 directly with small and medium-sized businesses. Direct expenditure with those companies totalled £1.3 billion during the year.
Funding for factories, testing and training
The government has allocated £250 million over five years to Defence Growth Deals in Scotland, Wales, Northern Ireland, South Yorkshire and Plymouth. The agreements support research, supply chains and training, alongside measures to make defence work more accessible to smaller businesses.
Plymouth’s £50 million deal will expand support for surface and underwater drone development through waterfront laboratories and testing facilities. Investment in Wales will widen access to MOD test ranges and provide infrastructure allowing smaller suppliers to undertake classified work directly.
A separate £182 million skills package over five years will support engineering and advanced manufacturing training. It includes five Defence Technical Excellence Colleges in England, one in Wales and up to two in Scotland.
Under an agreement between government and industry, 40,000 young people a year are to be offered opportunities and employment in skilled defence careers by 2030, rising to 50,000 by 2035. The commitment covers employment, apprenticeships and training as the sector recruits the workforce needed to deliver Britain’s defence programmes.
