Chapter 1 - Finance
                       
Table 1.10 Estimated UK Employment Dependent on MOD Expenditure and Defence Exports
                       
This table provides estimates of the number of full-time jobs supported in the UK by MOD expenditure and defence exports. The methodology is described in Defence Statistics Bulletin No.5, available on the DASA web site. "Direct" employment is that generated in those companies providing the product or service directly to MOD, or that within the exporter. "Indirect" employment is that provided through "the supply chain" by sub-contractors or suppliers to the "direct" contractor. The figures reflect average full time equivalent in year. The figures exclude MOD service and civilian personnel, and are shown rounded to the nearest five thousand. Differences between the totals and sums of the components are caused by this rounding.
                       
From 2002/03 onwards the numbers have been calculated using expenditure data derived from the MOD administrative systems that were introduced with Resource Accounting and Budgeting. The resulting changes to the methodology are described in Addendum No 5a to Defence Statistics Bulletin.
 
This table is outside the scope of National Statistics because the Defence exports data do not meet all of the high professional quality assurance standards set out in the National Statistics Code of Practice.
                       
Thousands
    1997/98   2001/02 3 2002/03 2003/04 2004/05 2005/06   2006/07
Total Employment1
 340   295 || 305 315 310 310   305
Direct 160   155 || 165 170 170 165   160
Indirect 180   140 || 140 145 140 145   145
Employment from MOD Expenditure
 230   235 || 245 250 240 260   255
Direct 115   125 || 135 140 135 145 r 135
Indirect 115   110 || 110 110 105 120   115
                       
Split by:
                    
 
Equipment Expenditure
                    
  Direct 70   75 || 85 85 80 85   80
  Indirect 75   65 || 75 70 70 75   75
                       
 
Non-Equipment Expenditure
                    
  Direct 50   55 || 50 55 55 60   55
  Indirect 45   40 || 35 40 35 40   40
Employment from Defence Exports1,2,4
 110   60 || 60 65 70 50   55
  Direct 45   30 || 30 30 35 25   25
  Indirect 65   30 || 30 30 35 30   30
Source: DASA (Economic Statistics)
1. The estimates of UK employment dependent on defence exports are based on estimates of those exports which are not of sufficient quality to be badged as National Statistics.
2. Figures calculated for "exports" are not derived directly from the financial figures for exports contained in Table 1.14. Adjustments are made for international collaborations, electronics and vehicle exports. Please refer to Defence Statistics Bulletin No.5 for further discussion. In aggregate the adjustments to the total export figures were £114 million in 1997, £859 million in 1998, £499 million in 1999, £49 million in 2000, -£143 million in 2001, £74 million in 2002, £48 million in 2003, £115 million in 2004, -£134 million in 2005 and £22 million in 2006.
3. In July 2001, part of the Defence Evaluation & Research Agency (DERA) was established as QinetiQ plc. These employees are now included in the "direct" employment total.
4. The increase in employment dependent on defence exports in 2004/05 reflects an increase in defence export sales, orders and deliveries identified predominantly in the aerospace, electronics and shipbuilding sectors during 2004. The methodology used to derive the defence export figures used to produce the employment estimates is described in Defence Statistics Bulletin No.5, available on the DASA web site.