Australian defence market to grow at a CAGR of 5.13%

The Australian defence market exhibited a compound annual growth rate (CAGR) of -1.42%, expenditure wise, to reach an estimated US $28.5 billion in 2012, and is forecast to grow at a CAGR of 5.13% over the next five years to reach $38.8 billion by 2017.

The government is expected to make cumulative capital acquisitions of $40.2 billion during this time, 35% of which will be procured from domestic firms, in order to support government plans to increase the independence of the Australian defence industry.

The acquisitions are expected to focus on the improvement of capabilities of the Australian Air Force and Australian Navy.

Australian homeland security expenditure registered a CAGR of 5.85% since 2008 and is expected to grow at a CAGR of 10.60% over the next five years to reach an estimated $411.08 million in 2017.

From the data available it has been suggested the Australian defence industry comprises between 200 and 300 core companies who employ an estimated 13,000 people.

One area that is having a drastic impact on the Australian defence market is the shortage of skills across a range of operational and managerial occupations. Skill shortages are already having widespread effects across the industry making this an area of concern.

For more information on the Australian defence market, see the latest research: Australian Defence Market Report

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