The Turbulent Past and Promising Future of the UK Aerospace Sector

The UK aerospace sector, renowned as the world’s second-largest, has long held a reputation as a global centre of excellence, supporting both major industry players and an expanding network of Small and Medium Enterprises (SMEs). However, the COVID-19 pandemic disrupted this momentum, halting production and placing significant pressure on a sector once thriving on consistent growth. Since then, UK aerospace has traversed a complex recovery phase, navigating a new landscape of challenges while striving to reclaim its prior standing. Major companies like Airbus, Rolls-Royce, and BAE Systems are crucial for the sector’s growth, supported by a promising SME ecosystem to drive advancement in sustainable aviation fuels and hypersonic technologies. With renewed focus on innovation and productivity, and signs of economic recovery, UK aerospace aims to rebound by leveraging its adaptability to tackle a new frontier.

Looking at the numbers, the aerospace sector turned over approximately £30.5 billion in 2023 (ADS Group, 2024). The value added to the UK economy has grown by 16% relative to figures a decade ago. As an export focused sector, key growth is likewise mirrored in this area, with exports in 2023 landing at £20 billion, a 14% increase from 2013 (ADS Group, 2024). Following the years of the COVID-19 pandemic, Figure 1 highlights the resurgence in export activity, pitching up towards pre-pandemic levels. Supported by a rise in productivity in the highly skilled space, experts such as ADS Chief Economist Aimee Stone have commended the sector’s resiliency in the years after a complete grounding of almost the entire civil aerospace sector.

Figure 1: UK Aerospace Sector Exports

However, it is not all smooth sailing as the journey ahead requires the industry to adapt to stringent sustainability targets whilst navigating around changes in government policy that could be brought in from the new Labour government. Difficulties in supply-chain and regulation are also setting off warnings as the latest figures from ADS show that commercial aircraft orders and deliveries fell 71% and 14% respectively in the first half of 2024 compared to the same period one year ago.

Looking ahead, the sector is shifting to quickly accommodate the ambitious sustainability agendas for aviation decarbonisation. Initiatives such as the Sustainable Aviation Fuel (SAF) mandate, which is setting a target of 10% sustainable fuel within UK jet fuel demand (Dept. for Transport, 2024) , have been showing signs of promise in making their way through parliamentary approval.  These initiatives are driving companies to fund wider research and development projects in the race to keep up with modern day environmental challenges. Subsequently, so too is the requirement for highly skilled labour, providing promising signs for a boost to the aerospace workforce across the next decade. Furthermore, the UK Civil Aviation Authority looks to drive local regulatory frameworks in alignment to the primary European Union Aviation Safety Agency (EASA) body, reducing roadblocks faced by UK companies in the future as newer technologies emerge (ADS Group, 2024).

Despite the initial COVID-19 stall, the UK aerospace sector is recovering and expressing strong indications of a comeback, compounded by increasing demand for innovation, skills and services. The future brings about complex challenges that the industry must remain agile in order to tackle, whilst keeping a close eye on regulatory and sustainability agendas.

ADS Group, (2024). ADS Aerospace Sector UK Outlook 2024. Available at: https://www.adsgroup.org.uk/facts-figures/ads-aerospace-sector-uk-outlook-2024/ 

Department for Transport, Haigh, L,. (2024) Written statement to Parliament – Sustainable aviation fuel initiatives. Available at: https://www.gov.uk/government/speeches/sustainable-aviation-fuel-initiatives 

Written by Shivam Naik | University of Bath