DEFENCE spending is “one of the most inefficient ways to create jobs” in Scotland and across the rest of the UK, experts have said.
It comes as the UK Government has gone all in on the idea of growth through military spending.
It was one of the key tenets of the Strategic Defence Review (SDR) – which was published in June and accepted in its entirety by Labour.
“The SDR will help make defence an engine for growth—boosting prosperity, jobs and security for working people across the UK,” the document read.
Keir Starmer quickly announced the [[UK Government]] would open six new munitions factories, build up to 12 new nuclear-powered submarines and invest £15 billion in nuclear warheads – as well as a raft of other commitments.
“Through this strategy we will bring the whole of society with us, creating jobs, growth and wages for working people,” the Prime Minister said.
In Scotland, meanwhile, Ian Murray launched a £250 million investment at the base housing the UK's nuclear weapons – HMNB Clyde at Faslane – in July, to be spent over the next three years to improve infrastructure at the site.
The Scottish Secretary described the spending as a “defence dividend” as he also talked up the economic impact of investing in the sector in Scotland, including through the Clyde 2070 programme, which will see billions pumped into the industry in the coming decades.
But the extent to which this investment will positively impact Scotland and create jobs across the UK is a matter of debate.
It’s not that jobs won’t be created, James Meadway – who is the host of the podcast Macronomics – told The National.
“Look. If the government spends a bit more money on something in the real world, it will – other things being equal – mean that there is more economic activity,” the economist, who is also a member of the Progressive Economy Forum and a former economic adviser to the shadow chancellor, said.
“There'll be a bit more growth somewhere, there'll be a few more jobs somewhere. That’s kind of what's going to happen.”
He added: “The trouble is it's just not very many for the obvious reason that if you look at military investment now and the kind of things that arms companies are producing – this is all really high tech stuff,” he said.
“This is not just churning out millions of shells or bullets. This is stuff that you use a great deal of high technology to produce, and that is also quite high technology. And if you are producing millions of shells, it's also now very capital intensive, rather than labour intensive, due to big machines making them.”
Meadway added: “And if you've got lots of high-tech stuff, like you're making drones and you're making quite sophisticated drones. It's capital intensive. You don't have many people employed doing it. You don't actually create many jobs and investment.
“So, as a starting point, if the Government is saying military spending, ramping up defence production will create more jobs, this is a bad way to do that.”
He went on: “The stuff that really creates jobs, it's actually probably fairly obvious. If you go to the NHS and you put more money into that, that means you're pretty immediately going to employ more nurses, more doctors, more people to your hospitals – all sorts of people working in a pretty labour-intensive healthcare occupation.
“Same thing goes for social care, same thing goes for education, to a significant extent. If you spend more on schools, you're going to need to employ more teachers. So, these things create lots of jobs. Military spending does not create lots of jobs.”
Mark Seddon, a professor of economic history at Sheffield University and the director of the Centre for United Nations Studies, also suggested that defence spending was an inefficient way of creating jobs.
“Building new royal naval craft, ships and submarines at Govan or Barrow-in-Furness, that’s got to be a good thing. I’m all in favour of keeping skilled jobs and expanding them in key sectors like that,” he said.
“But I’m not persuaded by this substantial increase in defence spending that it’s going to actually result in a lot of jobs in Britain.”
Seddon added: “It's not just the [[UK Government]], but the EU – which to my mind is becoming synonymous with NATO – seem to have a policy, which is increasing military spending in an effort to save their economy.
"I don’t think it will, I think it makes life a lot easier for the extreme-right politically, and I don’t think it’s going to bring jobs in any large numbers into the industrial areas.”
