Oxford Economics Report Finds British Army Contributes £15bn to UK Economy

The report, which is based on data from 2019, measured the contribution of the Army through things like jobs and social mobility.

Looking at every aspect of the Army, it studied hard and soft power, security and stability, and economic growth and prosperity. As well as the Army’s core purpose – to protect the UK – the benefits to wider society were looked at in depth, to measure in monetary terms what the Army contributes to the UK economy.

Ceremonial and operations duties were studied, as well support to civilian authority tasks, such as flooding, or the London Olympics. The Army’s contribution to the Union, and to ‘levelling up’; sharing wealth and resources throughout the UK, was also considered.

The report said:

The prestigious Army regiments who deliver ceremonial duties are drawn from all parts of the UK, reinforcing the notion of the Union between the four nations of the UK.

The scale of the Army means that it is an important source of jobs and income. The Army supports 271,000 jobs and directly employs 117,000 personnel, drawn from and based in areas right across the UK. This geographical dispersion means that the Army is already operating in accordance with the government’s ambition to spread prosperity more evenly across the UK.

The Army directly contributes £5.5 billion to UK GDP, but makes a much larger contribution through its procurement expenditures and as a result of workers’ spending. We estimate that the total economic footprint of the Army in 2019 supported 271,000 jobs and £15 billion in GDP.

This impact can be particularly important to local economies close to major bases. The results also indicate that that for every job that the Army directly supports, a further 1.3 are supported elsewhere in the economy as a result of supply chain or worker spending multiplier effects.

Similarly, for every £1 that the Army contributes to the UK directly, a further £1.70 is supported through multiplier effects. We estimate the value of training delivered by the Army in just one year to be more than £550 million. This result is conservative since it only relates to a subset of Army training which can be equated to formal education.

Key findings of the report were focused on social mobility and the benefits both to the individual and to wider society of the unique training the Army offers.

The report said:

The same training and opportunities boost social mobility, providing skills, focus, and structure to recruits from all backgrounds. This impact is particularly seen amongst junior soldiers who join at the age of 16 or 17.

In 2019 60% of these had only Level 0 or Level 1 qualifications. Within this group, more than 80% achieved a Level 2 literacy qualification by the time they were 19, compared with 21% in the wider population.

One example from the report of an individual benefitting from this training structure is Kidane “Danny” Cousland. Danny grew up on a housing estate in Tottenham, north London, and, hindered by his dyslexia, left school at 15 without being able to read. He suggests that at that point he was headed for a life of criminality. In the Army Danny found purpose. After passing out at the Army Foundation College in 2009, he enrolled on the Commando course before deploying to Afghanistan in 2011, patrolling daily as part of a fire support team at a time when causalities were at their height.

Danny’s potential was recognised while he was still a soldier and he was given the chance to go to Sandhurst for officer training. Danny excelled in the academic challenges at Sandhurst and was awarded the “Sword of Honour” for coming top of his intake in 2016.

Lieutenant Colonel Chris Ankers, the Army’s prosperity lead, said:“The Army’s primary contribution to UK prosperity is through the provision of national security. However, the Army provides many other benefits and placing a monetary value on these can be extremely challenging. Therefore, we’re pleased that the Oxford Economics report has studied this area for the first time. It shows the real breadth of where and how we add value, from developing the future UK workforce to innovation, social mobility, national resilience, exports, international engagement and infrastructure.”The report states:

Between 2009 and 2018, UK exports of equipment and services for land-based forces were worth almost £6 billion, or 7% of UK defence exports. The Army supports UK defence companies in their efforts to sell to overseas armies. This not only boosts exports, benefitting UK jobs, income and innovation, but provides a further opportunity for defence engagement with partners and allies.

Future Soldier, the Army’s transformation plan, will ensure that prosperity is a planned part of how the Army contributes. For example, the new Land Industrial Strategy will sustain 10,000 jobs across the UK and promote prosperity, targeting £6billion in export sales.

In addition to our relationship with industry, we will continue to provide social mobility through education, skills training, and by providing employment across bases and infrastructure.

Other findings include:

• The Army’s scale, resources, and expertise mean it is ideally suited to assisting civilian authorities during times of major crisis.  The MoD provided assistance to civilian authorities on 145 occasions in 2019.
• The Army undertakes an extensive range of overseas engagements to build relationships, promote British interests, help prevent future conflict, and reduce the likelihood of threats materialising at home. Many engagements are not widely known, but on a single day in 2019 more than 5,000 soldiers were deployed across 47 countries. A total of 61,000 soldiers were deployed to 128 countries during 2019.
• Closer to home, the Army delivers activities which enhance the UK’s “soft power” by promoting British values, heritage and culture. For example, the Royal Military Academy Sandhurst (RMAS) trains personnel from other nations in the British Army’s approach and ethos, creating lasting relationships with very senior figures from strategically important partner nations. RMAS is currently training 105 international cadets from 40 countries.
• The Army also contributes to the UK’s soft power through State Ceremonial and Public Duties, and major events such as the Royal Edinburgh Military Tattoo.
• The Army’s activities to deliver its core purpose contribute to the UK’s long-term productivity and prosperity. For example, while the Army undertakes research and development with the aim of increasing its operational effectiveness, such investment creates wider spillover benefits as the knowledge and knowhow developed are disseminated and put to other uses.
• Since the start of 2010/11, the British Army has spent close to £1.6 billion on R&D and we estimate this has increased the UK’s productive potential by 0.03% per year—equivalent to £730 million in 2019/20.
• We estimate the value of training delivered by the Army in just one year to be more than £550 million.