What’s new about skills in Size & Health 2023?

29^th July 2024 by Joseph Dudley and Heidi Thiemann

It’s been a big month for the space sector: a new government, a new minister, and now a new Size & Health report! This report, published by London Economics, covers 2021/22.

As usual, it’s packed with interesting stats about the state of the sector, but what we care about is: what does it tell us about skills and the workforce?

Employment has grown a lot

The sector continues to grow. Employment in 2021/22 saw a 6.7% increase to around 52,000. The 2022 report predicted a much more modest increase of 0.7% in non-DTH employment. Sadly no explanation is given for why there is such a significant difference between the prediction and the reality. There are notably no predictions for 2023’s numbers.

That growth doubles once we exclude DTH broadcasting, but a huge proportion comes from the massive increase in Space Operations. We’re suspicious of that number. Did the sector really add 2000 people in operations? We find it very unlikely, and suspect that this is a statistical artefact of a change in methodology or sample. A new category of 'In-Space Economy' was introduced, but we don’t think it will have had this effect. However, even excluding it we get a very robust increase of 7.4% overall

56% of companies expect an increase in their workforce in the next three years, about the same as in 2022. 7% expected a decrease, 27% expected it to remain the same, and 10% were unsure. Excluding the don’t knows, those numbers are 62% growth, 30% stay the same, 8% shrink.

Those numbers are probably a bit optimistic. The Space Sectors Skills Survey 2023 found that 48% of organisations had recruited to expand in the past 12 months, 44% had replaced levers or not needed to recruit, and 9% had had a hiring freeze.

Most of the workforce has a STEM background

80% of people have a degree (90% in 2020 Space Census) and 11% have a vocational qualification (7% in 2020 Space Census). For the first time there is a breakdown by subject:

Given the significant skills gaps around software, data, and AI skills, we really need to get that computer science number up.

Neither too young, nor too old, the space sector is just right

Also a new addition to S&H, we have data on the age breakdown of the workforce, with a sample size of about 5000. The results have the sector a little bit greyer than the Space Census estimates, but overall pretty balanced.

Foreign nationals make up 13% of the workforce

Another new addition, we are truly blessed! This one’s a really pleasing result for us because it aligns perfectly with the Space Census.

Gender diversity hasn’t improved

There is still a significant gender imbalance in the industry, with 75% of employees identifying as male and 23% female, with virtually no change from S&H 2022 or 2021. The big change is the other/non-binary figure has shot up from 0.1% in 2022 to 0.7% in 2023. It’s unclear whether that is due to an increase in measurement by the companies responding to S&H. It now aligns more closely to our findings from the 2020 Space Census.

Recruitment and skills are now the top barriers to growth

A subset of 58 respondents gave their top 5 barriers to growth. Skills came out in the top two overall with 41% including ‘recruiting staff’ (down from 46% in 2022) and 40% including ‘shortage of skills generally’ (up from 38%). Further down the list, 17% included ‘shortage of managerial skills / expertise’ (up from 12%).

In 2022 recruitment and skills were #3 and #4 on the list of barriers, behind economic uncertainty and limitations on EU programme involvement. They’ve now jumped up to spots 1 and 2, emphasising the importance of further work on skills.

Our 2023 Space Sector Skills Survey gives a breakdown of what these skills are – primarily software, data, and AI, and systems engineering.