The defense industry in 2018 saw increased growth driven by a rise in military expenditure across the world. Technology innovations like blockchain and cybersecurity advancements also impacted the business sector, as companies sought to make their operations more efficient and secure. Still, multiple risks abound, especially in regard to competition, as well as being able to source and retain security-cleared IT talent.

If your organization serves the world of defense and government IT, it helps to understand the overall performance of the sector, and what trends are expected to continue into the current year. As such, here is a high-level overview of last year’s defense sector.

Defense Spending on the Rise

2018 saw an overall increase in worldwide defense spending. The United States remains the leader in this area, with its military budget expanding under the new Trump administration. Other regional powers boosted their outlays, especially China, Japan, India, and Russia.

Driven by growing global tensions and the fostering of new geopolitical risks, this increased spending is expected to continue, at a minimum, into 2019.  Deloitte’s Robin Lineberger offered some additional details.

“Defense budgets in the United States have been on the rise; and, the new administration’s increased focus on strengthening the nation’s military is expected to keep defense spending on the higher side in 2019 as well. NATO countries also appear to be focusing on increasing defense budgets to counter potential threats from Russia and the Middle East,” said Lineberger.

Combating Cyber Threats

The defense industry continues to focus on cybersecurity and fighting other similar threats. According to the Deloitte 2019 Global Aerospace and Defense Industry Outlook referenced earlier, militaries around the globe are currently implementing digital tools able to integrate protection against both traditional and newer cyber threats. For example, the U.S. Army is currently adding cyber and electromagnetic activities (CEMA) cells into its current operational formations. Expect increased investment in this form of information security in 2019 and beyond.

Space is a New Frontier for the Defense Industry

In addition to cybersecurity, 2018 introduced space as another frontier for the defense industry. Although satellite surveillance has been used for decades, the protection that these space assets provide is growing in importance. Satellite technology is now a growing field that is being leveraged for military communications, missile targeting and other use-cases.

This growing militarization of space is driving additional defense spending by the United States, China, and Russia, with other countries expected to increase their own research and development in this area.

Ultimately, continued expansion in the militarization of space, combined with the growing importance of cybersecurity on the battlefield and larger government military expenditures, reflect the current state of the defense industry across the globe. This creates new opportunities for companies experienced with providing IT services to the government and defense sector.

When you are looking for additional insights and a knowledgeable company to partner within defense contracting and technology, turn to the experts at Entrust Solutions. We understand this unique market and can help your business reach new levels of success.


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