Growth in spite of skills gaps

The UK Aerospace and defence sector continues to thrive, on its journey to reaching pre-pandemic performance in 2024.

The UK aerospace sector had a 300% YoY increase in orders and a 40% increase in deliveries in May 2023.

Labour and supply chain shortages have slightly spoilt the party, causing airlines to express frustration with delays to plane deliveries, a full supply chain recovery is not expected until 2026.

The skills gap is becoming increasingly tight as international demand for workers increases on back of the war in Ukraine and rapid growth in artificial intelligence and machine learning activity Cobham and Ultra boss, Shonnel Malani, has suggested that the rise in home working is an obstacle in the war for talent with more flexible foreign rivals

Contract wins

Tempest

The Ministry of Defence have awarded a contract extension worth £656 million to BAE Systems to progress the concepting and technology of the next generation combat aircraft known as Tempest in the UK

Airbus

A rbus secures biggest p ane order in the history of commercial aviation IndiGo has placed an order for 500 A320 Fam ly a rcraft in a big boost for Airbus Broughton

Moog

Open a £40 mill on aerospace factory in Gloucestershire American engineering giant Moog has opened its new aerospace div sion headquarters in Tewkesbury

Rolls Royce

1,170 jobs boost for East Midlands as Rolls-Royce announces plans to expand Raynesway site to provide all the nuclear reactor plants to power new attack submarines as part of the tri-lateral AUKUS agreement between Australia the UK and US

Safran

French aerospace engine maker Safran SA is nearing an approx mately $1.8 bil ion deal to acquire a Raytheon Technologies Corp unit that makes flight controls for aircraft, hel copters and missi es according to a person familiar with the matter

Industry headlines

Aerospace Sector Thrives with 300% YoY increase in orders alongside 40% increase in deliveries Orders placed in May 2023 are 306% higher than in May 2022 at 146 aircraft orders. A 38% increase in aircraft deliveries in May 2023 is encouraging for the sector amidst supply chain challenges and slightly muted start to the year.

BAE Systems trading Update Trading so far this year has been in line with expectations with continued good operationa performance The AUKUS announcement n March provides a significant boost as well as the continued increase in defence spending in NATO countries prompted by the war in Ukraine.

Construction begins on Roya Navy's fourth Type 26 frigate - HMS Birmingham BAE

Systems plans to recruit a further 400 trades people and 200 apprentices for the programme in 2023

Airbus reports strong first quarter demand but sales and earnings decline continue to face an adverse operating environment that includes, in particular, persistent tensions n the supp y chain.

At the 2023 Paris Air Show the UK Government announced £218 million funding to help develop cutting-edge green aviation technology and grow the UK’s share of the global aerospace market

Skills shortages

Much of the supp y chain cr sis boils down to skills shortages, the aerospace sector employed about 3 000 fewer direct employees in 2022 compared with 2021 On top of that the number of apprentices also dipped over th s period by 300, to 5,500

Qinetiq s looking to double its revenue to £3bn by the end of 2027, including acquis t ons Increased European and IndoPacific threats are driving rap d defence modern sat on with the addressable market increased from >£20bn to >£30bn per year due to recent commitments to higher defence spend ng in the US UK and Austral a

Ro ls-Royce turnaround mov ng at pace ' under new CEO Rolls Royce are on track to meet 2023 forecasts, buoyed by cost savings and the ongoing travel recovery A strategic review of the company was launched by the CEO, Erginbilgic, and is due to report in the second half of 2023

Safran posts strong sales but sees supply chain r sks unvei ed stronger than expected quarterly revenues on Wednesday, buoyed by a sw ft recovery in air travel but predicted problems with aviation s supply chain could drag into next year

Industry recruitment headlines

Across the 1,200 members represented by ADS, the trade association for aerospace, defense, security, and space sectors, there are more than 10,000 currently unfilled vacancies, three quarters of members see the workforce and skills shortages as having a big impact on business These companies collectively employ 417,000 people and have a combined turnover of £82bn

A rbus expects to recruit 13 000 staff by the end of 2023 Airbus CEO Guillaume Faury had said that supply chains had stabilised although the industry still faced pressing labour shortages.

Spirit AeroSystems h ring 100 new workers in Belfast expans on

Work to commence on Leonardo’s new Newcastle facility set to create more than 200 jobs at the base