Starmer’s Defence Investment Plan means another £15 billion for deadly weapons of war. Paid for by cuts to public services. The government argues increasing war spending boosts jobs growth. But it’s own data shows this is a lie. It’s time to invest in saving lives not destroying them.
The “Defence Dividend” Myth
While announcing large increases in military spending, the government has promised that the military budget will provide a “defence dividend”, stimulating growth and creating jobs across the country. But the claim that military spending is an effective growth or jobs strategy does not withstand scrutiny. It is especially pernicious when cuts are planned across the public sector to fund increased military spending. As admitted by the National Armaments Director, cutting civilian investments to fund a larger military budget will harm growth.
As shown by the government and public data presented below, military procurement spending creates fewer jobs than equivalent investment in rail, health, libraries and museums, education, or care. It is particularly important to assess the economic impact of procurement spending as the Ministry of Defence’s spending on weapons procurement occupies an ever larger share of its budget and is the focus of the “defence dividend” claim.
The poor economic performance of military spending is due, in part, to two factors that limit its domestic benefits. Military spending has become increasingly capital intensive, with expensive, hi-tech weapons programmes employing a shrinking number of workers. Even though the military budget is larger now in real terms than in 1980, jobs in the military industry have plummeted. In the UK, this is compounded by the billions spent on weapons imports each year; about sixteen per cent of the Ministry of Defence’s spending is overseas.
Spending on the military budget is also concentrated in wealthier parts of the country. Claims made by the Chancellor Rachel Reeves that military spending would “revive” ex-industrial regions of the UK are outlandish, given that more than half of military spending with UK industry goes to firms in the south of England and London.
These dynamics pose a problem for the military establishment, as increasing the military budget is only popular when tied to jobs and apprenticeships and it is especially unpopular if funded by cuts to public services like the NHS. Thus, the claim of a “defence dividend” is used to garner public support. This is aimed at avoiding a public conversation on the opportunity costs of not investing in other sectors and on the other problems associated with militarism (like global power projection, corruption, waste and inequality).
What the Government’s Own Data Says
- Every £1 million of Ministry of Defence spending with UK industry supports 9.4 jobs in the UK (Source: MOD procurement budget 2024 and MOD employment estimates 2025)
- Every £1 million Transport for London spent on procurement supports 13.7 jobs in the UK (Source: TfL supply chain assessment 2024)
- Every £1 million spent in the education sector supports 14.9 jobs in the UK (Source: ONS 2023)
- Every £1 million spent in the healthcare sector supports 13.4 jobs in the UK (Source: ONS 2023)
- Every £1 million spent in the residential care and social work sector supports 19.8 jobs in the UK (Source: ONS 2023)
- Every £1 million spent in the libraries, archives, museums and other cultural activities sector supports 25.5 jobs in the UK (Source: ONS 2023)
- Every £1 million spent in the rail transport sector supports 12.2 jobs in the UK (Source: ONS 2023)
DOWNLOAD GRAPHIC HERE