Building the evidence base on skills in the European defence industry

HighwayStarz/Adobe Stock Low national defence budgets and insufficient levels of defence investment have resulted in potential shortages and mismatches in EU defence-related skills. An empirical examination of these found that a focus on four broad skills groups: cross-cutting technical skills

domain-specific skills

skills relating to new and emerging technologies, and

soft skills could help the industry address existing and future skills gaps.

Background

The European defence industry requires a wide-ranging and continually changing array of skills to keep pace with the evolving defence landscape and to help drive economic productivity across the continent. As a result, the sector needs to develop and sustain the skills required to help safeguard Europe’s strategic interests and autonomy as well as drive economic growth. However, research was needed to understand the factors that influence job skills for the defence sector before a comprehensive skills strategy could be developed to meet those needs.

Goals

RAND Europe, in cooperation with Fondazione Giacomo Brodolini, was commissioned by the European Commission to:

develop an overview of the existing and future defence-skills landscape in the EU;

identify and analyse the skills gaps and assess the causes of these gaps; and

deliver a mapping of initiatives to address the skills gaps.

Methodology

A key component of this project was the establishment of the European Defence Skills Partnership (EDSP) which brought together stakeholders from industry, government, academia, and training providers. It allowed researchers to draw on a broad evidence base across 20 different EU countries which, crucially, includes small and medium-sized enterprises (SMEs) and other lower-tier suppliers.

The project included:

Data gathering and analysis from 17 EU-level policies and funding tools, 371 defence-related skills initiatives across 16 EU member states, 51 expert and stakeholder interviews and 81 defence industry survey responses. Stakeholder consultation to validate findings through 39 expert interviews and nine workshops with EDSP members.

Findings

Different factors shape the demand for skills in the defence industry

The relationship between demand and the supply of skills is influenced by the fragmentation of European-level demand and the monopsony of the national market, as EU member state governments act as a regulator and a sole customer for multiple defence companies.

and the monopsony of the national market, as EU member state governments act as a regulator and a sole customer for multiple defence companies. Fiscal pressure on European defence spending at the member state level and a lack of new acquisition programmes or investment in research and development have all contributed to rising concerns over the availability of many of the skills needed for a competitive European defence technological and industrial base.

have all contributed to rising concerns over the availability of many of the skills needed for a competitive European defence technological and industrial base. The integration of new technologies into defence products and services will affect the nature of industrial skills required in future.

The pan-European defence industry has common areas of skills gaps and mismatches

Cross-cutting technical skills that apply across multiple defence domains such as air, land, naval, complex weapons and space. People with these skills have a secondary or tertiary education in STEM (science, technology, engineering and mathematics) subjects with varying levels of experience unique to defence.

that apply across multiple defence domains such as air, land, naval, complex weapons and space. People with these skills have a secondary or tertiary education in STEM (science, technology, engineering and mathematics) subjects with varying levels of experience unique to defence. Domain-specific technical skills with a narrow application that are predominantly acquired and developed by working on a capability programme for a number of years.

with a narrow application that are predominantly acquired and developed by working on a capability programme for a number of years. Skills relating to new technologies that will enable the defence industry to successfully harness technological innovation. They might relate to artificial intelligence and machine learning, robotics and cyber skills.

that will enable the defence industry to successfully harness technological innovation. They might relate to artificial intelligence and machine learning, robotics and cyber skills. Defence-relevant soft skills such as management, procurement, legal counsel and sales. While staff will require knowledge and understanding of the defence context to operate effectively, their underlying skills will remain the foundation for their role.

A combination of factors drives these defence skills gaps and mismatches

These include:

Demographic challenges , such as when senior and experienced workers potentially retire without adequate replacements or knowledge transfer.

, such as when senior and experienced workers potentially retire without adequate replacements or knowledge transfer. A mismatch between employer needs and educational/training output in terms of the volume and composition of the skilled workforce produced.

in terms of the volume and composition of the skilled workforce produced. Competition for skilled workers from non-defence sectors , some of which may be attributed to perceptions of defence as unattractive, less dynamic and less well-paid.

, some of which may be attributed to perceptions of defence as unattractive, less dynamic and less well-paid. Insufficient demand for skills because of low defence investment at national and/or European level. Declining defence budgets and relatively low levels of defence investment over the past two decades have resulted in an overall stagnation of industrial skills and learning across Europe.

Several initiatives have aimed to address these gaps

Researchers reviewed many past and current initiatives aimed at addressing defence-related skills, but with mixed results. These are:

EU initiatives . Increasing recent focus of EU-level policymaking on defence and important initiatives, such as EDAP, contributed to raising awareness about the funding opportunities and need to tackle skills challenges of the defence sector.

. Increasing recent focus of EU-level policymaking on defence and important initiatives, such as EDAP, contributed to raising awareness about the funding opportunities and need to tackle skills challenges of the defence sector. National and regional policies and programmes . These include initiatives by education and training institutions to encourage uptake of STEM skills relevant to the sector, but these are less able to supply critical, defence-specific skills and adapt rapidly to changes in skills requirements.

. These include initiatives by education and training institutions to encourage uptake of STEM skills relevant to the sector, but these are less able to supply critical, defence-specific skills and adapt rapidly to changes in skills requirements. Industry-led policies and programmes . These programmes are aligned with the right skills requirements however shortages persist because of the difficulty of attracting STEM talent.

. These programmes are aligned with the right skills requirements however shortages persist because of the difficulty of attracting STEM talent. Joint programmes. Programmes between industry, government bodies and the education sector were found to aid the pooling of resources, as well as the development of valuable skills. However, the restrictive work culture and regulations in the defence industry tends to limit worker mobility across the defence and civil sectors.

Observations

Certain defence-industry skills are difficult to source across the EU, but a focus on the four broad skills groups – cross-cutting technical skills, domain-specific skills, skills relating to new and emerging technologies, and soft skills – could help the industry address existing and future skills gaps.

Demographic challenges could be tackled by introducing initiatives to retain staff, and by encouraging relevant national authorities and the industry to conduct long-term thinking and planning for providing skills in defence.

A steadier and more tailored talent pipeline could be achieved by improving communication and collaboration between the industry, governments and the education and training sector, as well as by developing a more accurate understanding of the skills that will be needed in the short-, medium-, and long-term futures.

Given that the industry reported a lack of ‘raw talent’, it is important to design a joint skills profile – with a focus on agile learning and defence-relevant soft skills – to broaden the pool of talent that both defence and commercial sectors could draw upon.

The somewhat outdated image of the defence industry as a siloed, inflexible and male-dominated workplace is changing, and companies are keen to promote diversity and raise the attractiveness of the defence industry to potential recruits.

Declining defence budgets and low levels of defence investment have resulted in an overall stagnation of industrial skills and learning across Europe. However, the European Defence Fund could help streamline EU investments, and national defence funding has also been increasing in recent years, supporting the development and maintenance of skills.