Talent Acquisition in the Aerospace and Defense Industry: Challenges and
Strategic Responses
The aerospace and defense (A&D) industry faces a critical challenge: a growing talent shortage
compounded by rising employee turnover and heightened competition from other sectors. As
companies ramp up production to meet increasing demand, driven by rebounding air travel,
heightened geopolitical tensions, and renewed interest in space exploration, the need for a robust
workforce strategy has never been greater.
Rising Turnover and Workforce Pressures
The A&D sector is grappling with significant turnover, with 69% of companies reporting
increased attrition in the 2022 fiscal year. This mirrors broader labor market trends: in 2021, 47
million Americans quit or changed jobs, driven by a desire for better pay, career advancement,
and flexibility. These pressures are acutely felt in A&D, where companies not only compete
within the industry but also face stiff competition from technology and other sectors seeking
employees with technical expertise. Beyond turnover, 41% of companies noted worsening employee engagement in the 2022 fiscal
year. The lingering effects of the COVID-19 pandemic, including supply chain disruptions and
operational challenges, have exacerbated these issues, making workforce management a top
priority. While the pandemic is years behind us now, data sourced from previous years can
inform A&D contractors about how to navigate this delicate landscape in the present and the
future.
Adapting to a New Talent Landscape
To address these challenges imposed by the hardships of the Covid years, many A&D companies
are reimagining their talent strategies, focusing on four key areas:
1. Strengthening Employee Value Propositions (EVP):
Companies are enhancing their EVPs by offering programs that emphasize mental
well-being, leadership development, and technical education. Many are also focusing on
career development, employee recognition, compensation improvements, and flexible
work arrangements to attract and retain talent.
2. Flexible Work Models:
While remote work remains challenging for high-touch manufacturing roles, 65% of
respondents believe they have successfully implemented flexible work arrangements,
including staggered shifts and four-day workweeks. Hybrid and remote work options
have also expanded for eligible employees, reflecting broader trends toward workplace
flexibility.
3. Reskilling and Upskilling:
A&Dcompanies are investing in upskilling initiatives focused on digital skills, data
analytics, AI, machine learning, and cybersecurity. Partnerships with universities to offer
STEMcourses and mentorship programs are helping bridge the skills gap, ensuring a
pipeline of future-ready talent.
4. Diversity, Equity, and Inclusion (DEI):
DEI remains a priority, with many companies launching detailed DEI strategies that
include executive advisory boards and benchmarking reports. These initiatives aim to
improve diversity across gender, supplier demographics, and other key metrics, fostering
a more inclusive workforce.
Flexible Work: A Key Differentiator
The Covid-19 pandemic accelerated the adoption of flexible work arrangements in A&D. 84% of
companies now offer remote options, while 72% have hybrid models requiring some in-person
presence. Flexible hours are also widespread, although their adoption dropped slightly from 85%
to 81%. As companies explore long-term solutions, they are evaluating real estate needs, with
78% planning moderate to extensive changes to their real estate strategies.
Balancing flexibility with the need for on-site work in manufacturing roles presents ongoing
challenges, but the sector is committed to finding sustainable models that support both business
needs and employee preferences.
Strategic Workforce Transformation
Looking ahead, A&D companies recognize the imperative to transform their workforces to meet
future demands. This includes developing a more dynamic, hybrid workforce equipped with
digital and technical skills. Automation and new operating models will play a critical role in
driving efficiency and innovation.
Deltek Costpoint: Supporting Talent Acquisition and Management
Deltek Costpoint offers A&D companies a strategic advantage by streamlining HR and talent
management processes. Its integrated, automated HR tools simplify recruitment, onboarding, and
compliance, allowing HR teams to focus on strategic initiatives. Costpoint’s analytics
capabilities also provide valuable insights into workforce performance and skills gaps, enabling
proactive talent planning. By fostering more agile HR practices and supporting remote work through cloud-based
solutions, Deltek Costpoint empowers A&D firms to attract and retain top digital talent in an
increasingly competitive landscape.
Conclusion
The aerospace and defense sector is at a critical juncture. To thrive in a competitive talent
market, companies must invest in innovative workforce strategies that prioritize flexibility,
career development, and inclusivity. By fostering a culture of continuous learning and embracing
new work models, A&D firms can position themselves as employers of choice, securing the
talent needed to drive innovation and growth in the years ahead.
