Advancing UK Aerospace, Defence, Security & Space Solutions Worldwide
  • Home
  • /
  • Space
  • /
  • UK's space sector expands faster than its economy

Space

UK's space sector expands faster than its economy

The UK space sector is expanding faster than the overall UK economy, contributing over £17.5 billion annually, employing more than 45,000 people and supporting £360 billion in economic activity through satellite infrastructure.

Image courtesy Heligan Group

According to Heligan Group, M&A activity across the sector has rocketed over the past decade from only five transactions in 2013 to 27 in 2023 and will continue to grow in 2025 due to increasing government funding, the falling cost of launches and the adoption of new technologies, such as satellite-based quantum key distribution technology.

Advertisement
ODU RT

 
Simon Heath (above), Partner at Heligan Group, said: “Advances in technology such as reusable rockets, orbital refuelling, and in-space manufacturing via 3D printing are driving the wave of innovation in the space sector. A prominent development for the UK is the growth of small satellite technologies, which are revolutionising the space industry by providing cost-effective and accessible satellite services.”
 
UK SMEs are playing a transformative role in the global space industry, specialising in satellite components, propulsion systems, and space data analytics, with many outpacing larger firms by focusing on niche technologies. Many are hopeful that a Space X-scale company will emerge from the UK over the next decade with the rising risk of SMEs being acquired by larger integrators.
 
Simon said: “Most UK space SMEs operate outside traditional aerospace hubs, decentralising the industry and fostering innovation across the country; this broader talent base is crucial for the long-term competitiveness of the UK space industry. With this, SMEs face growing challenges, including a reliance on large upfront investments, investors remaining cautious due to long timelines, and government funds becoming increasingly competitive.”
 
Access to growth finance and investment in the UK space sector has seen improvement in recent years but remains a mixed landscape. Nevertheless, trends indicate increasing interest from venture capitalists and corporate investors. Corporate venture arms of major aerospace and defence organisations such as Airbus and BAE Systems are actively investing in innovative space technologies. The UK government has also remained a key player, offering funds and grants through The UK Space Agency and Innovate UK.
Advertisement
ODU RT

 
Simon added: “Over the next 24 months, we will see a variety of themes driving activity in the UK space sector. Space infrastructure investment will be a primary concern as strengthening the UK’s space resilience is a national security priority. There will also be consolidation, with the market being highly fragmented and full of young, IP-rich and fast-growing businesses. Lastly, technological advancements such as innovations in small satellite systems and reusable launch vehicles are lowering entry barriers, reducing investment risks, and creating new opportunities for space startups.
 
“It is exciting to see the UK position itself to become a leading force in the global space economy. Although it currently lags behind other nations in space launch capacity, this will change with multiple launches planned from UK soil in 2025, with UK SMEs playing a bigger role than ever. Rapid technological advancements and escalating geopolitical tensions have intensified reliance on private sector innovation, with sovereignty playing an important role in supply change.
 
“While the space sector is growing, it is a typically cash-hungry industry with profitability for many of the UK’s brightest companies still several years away. However, the space sector is one area where the UK government is highly supportive, and this is mirrored in the private sector, with several VC investors solely focusing on frontier technologies. 2025 will be an interesting year for the UK space sector as interest from venture capitalists and corporate investors continues to grow."
 
Based in the UK with offices in London and Birmingham, Heligan Group is an intelligence led investment and advisory group specialising in partnering with businesses that contribute to global safety and security.

Advertisement
Babcock LB
Satellite comms set to improve connectivity in remote areas of UK

Space

Satellite comms set to improve connectivity in remote areas of UK

28 November 2024

New projects are set to test innovative hybrid connectivity solutions in some of the very hardest to reach places in the UK, with up to £3.5 million in UK Government funding.

Airbus to provide UK MoD with satellite modems for Skynet

Defence Space

Airbus to provide UK MoD with satellite modems for Skynet

26 November 2024

Airbus has signed a contract with the UK’s Ministry of Defence (MoD) to provide the next-generation modems for the nation’s Skynet satellite communications constellation.

University of Surrey

Space

University of Surrey's Prof Adam Amara appointed as UKSA Chief Scientist

25 November 2024

Renowned astrophysicist Professor Adam Amara, Director of Space Strategy and Head of the School of Mathematics and Physics at the University of Surrey, has been appointed as the UK Space Agency's (UKSA) new Chief Scientist.

Cohort acquires EM Solutions

Defence Space

Cohort acquires EM Solutions

22 November 2024

Independent technology group, Cohort plc, has strengthened its naval defence sector offer with the acquisition of EM Solutions, an Australian developer and producer of high-end satellite communication terminals for global navy and defence customers.

Advertisement
ODU RT
Blue plaque honours developer of revolutionary hydrogen fuel cell at Marshall

Space Events

Blue plaque honours developer of revolutionary hydrogen fuel cell at Marshall

21 November 2024

Tom Bacon (1904-1992), an engineer who developed a fuel cell used to power the Apollo 11 spacecraft which made the first moon landing, has been recognised with a commemorative blue plaque marking the impact of his work.

Recruitment bias preventing STEM professionals returning to work

Aerospace Defence Security Space

Recruitment bias preventing STEM professionals returning to work

21 November 2024

Bias in the recruitment system is still preventing talented STEM professionals on a career break from returning to employment, according to a new survey by STEM Returners.

Advertisement
ADS S &P RT