Defence industry faces ‘critical’ skill shortage, placing future submarine and frigate programs under threat

Naval shipbuilders have warned the nation’s future submarine and frigate programs are at risk from labour shortages, amid competition from infrastructure and mining.

BAE Systems managing director for maritime, Craig Lockhart.

Naval shipbuilders have warned the nation’s future submarine and frigate programs are at risk from a shortage of engineers and IT specialists, as Defence competes with the resurgent infrastructure and mining sectors for the same limited skilled labour pool.

Eight of the country’s top shipbuilding employers met with Defence Industry Minister Melissa Price in Canberra last week, warning they were all “fishing from the same pool”, and would be “critically short” of skilled labour unless the government secured their workforce pipelines.

It’s understood some companies, including Attack-class submarine builder Naval Group, are battling attrition rates of up to 12 per cent.

BAE Systems managing director for the Hunter-class frigate program, Craig Lockhart, said systems engineers, programmers, schedulers, control engineers and occupational health and safety professionals were among the professions in high demand.

“We are all extremely nervous about having the people capability to meet our sovereign response,” he told the Committee for Economic Development of Australia.

“Without a national-level response to this we will be critically short. Within the next five years, between submarines and warships, there are 15,000 direct new positions required.

“And we have estimated there is a multiple of three to four required within the supply chain.

“That’s a huge amount of people we need to find. And if we continue to deliver a state-based response, which is in competition with our universities and TAFEs and other things, then I think we will find that resource is not there, or capable, when we require.”

Mr Lockhart said the lack of foreign students in Australian was compounding the skilled labour shortage.

“That may not seem that relevant but when we are seeing growth in the mineral sector and the infrastructure sector, those adjacent sectors are using the same pool that we have traditionally ring-fenced as our defence capability people,” he said.

Mr Lockhart said without an effective national strategy, “you’ve got all the universities and TAFEs trying to compete with each other, and as a shipbuilding sector we want to be a lot more focused than that”.

Representatives from Naval Group, Luerssen Australia, ASC, Austal, Saab, Navantia Australia, and Lockheed Martin also attended the meeting. Ms Price said she was working to ensure the key defence programs had the workers they needed through a series of programs and grants to bolster the numbers of engineering and technology students coming through the system.

“I reinforced the Morrison government’s commitment to building the pipeline of skilled Australian workers in partnership with industry and tertiary and skills training sectors,” she said.

The companies’ workforce difficulties come on top of well-publicised problems with key programs, including the $90bn Attack-class submarines and $45bn Hunter-class frigates, which face design challenges, delays and cost blowouts.

Mr Lockhart maintained the Hunter-class did not have a weight problem, despite having only a slim 3 per cent margin for future growth which one industry source described as “a few coats of paint”.

The future submarine program is at an impasse over the price of the contract for the detailed design of the ­submarines, which will be a first-of-type conventional long-range submarine based partly on the ­design of France’s Barracuda-class nuclear-powered boats.

Defence secretary Greg Moriarty recently revealed “prudent contingency planning” was under way in case the program faltered.

However, some program tensions were eased at a meeting between Scott Morrison and French President Emmanuel Macron, with the Prime Minister crediting Mr Macron for the “much improved position” of Naval Group.