AUKUS Jobs: Official Claims V Economic Realities
Submission to the National AUKUS Inquiry

David Higginbottom Co-Convenor Make Peace A Priority

July 2026

1. Introduction

The AUKUS nuclear-powered submarine program has been consistently framed by the Australian Government as the most transformative industrial endeavour in the nation's history. To secure public support for a project with an estimated cost of $368 billion, official communications have heavily emphasised job creation, economic growth, and regional development (see the AUKUS Submarine Workforce and Industry Strategy).

However, an independent analysis of the workforce data, project timelines, and opportunity costs reveals a stark divergence between the political rhetoric of a "jobs bonanza" and the economic realities. Furthermore, a rigorous analysis of the trilateral workforce requirements demonstrates that a substantial portion of the new employment generated specifically by the Australian taxpayer's investment will occur overseas, particularly in the United Kingdom and the United States.

This research brief examines the official claims regarding AUKUS job creation, contrasts them with independent economic critiques, and provides a phased, year-by-year forecast isolating the incremental workforce growth driven directly by Australian AUKUS expenditure.

2. Official Claims: The "20,000 Jobs" Narrative

The central pillar of the Australian Government's domestic messaging on AUKUS is the claim that the program will create "around 20,000 direct jobs over the next 30 years" (see the Joint Media Release, Department of Defence, March 2023). This figure is frequently cited by the Prime Minister and the Minister for Defence to justify the unprecedented expenditure.

According to the official AUKUS Submarine Workforce and Industry Strategy and the Australian Submarine Agency, this 20,000 figure is broadly distributed across the following areas over a three-decade horizon:

Infrastructure Construction: Up to 4,000 workers to design and build the new submarine construction yard at Osborne, South Australia, and upgrade facilities at HMAS Stirling in Western Australia.

Submarine Construction: 4,000 to 5,500 direct jobs to build the SSN-AUKUS submarines in South Australia when the program reaches its peak (projected for the late 2030s to 2040s).

Sustainment and Operations: The remainder comprises Australian Defence Force (ADF) personnel (submariners), Australian Public Service (APS) staff, and industry workers maintaining the fleet.

The government asserts that between 2027 and 2032, an initial 500 direct jobs will be created in Western Australia to support the Submarine Rotational Force-West (SRF-West), sustaining visiting US and UK submarines.

However, it should be noted that, at no time, does the
total number of jobs created in Australia exceed ~8,500.

3. The Realities: Independent Critiques and Opportunity Costs

3.1 The $18 Million per Job

The most prominent critique of the AUKUS jobs narrative comes from the sheer cost per job created. Professor John Quiggin of the University of Queensland calculates that, based on the $368 billion upper cost estimate and the 20,000 jobs figure, the program equates to roughly $18.4 million per job (see Quiggin, The Conversation, March 2023). This represents an exceptionally poor return on investment compared to standard domestic economic stimulus or infrastructure projects. As Quiggin notes, "The Albanese government's attempt to sell the AUKUS nuclear submarine plan as a job-creation program is bad economics."

3.2 The Opportunity Cost of Military Spending

Research from the Political Economy Research Institute (PERI) at the University of Massachusetts Amherst demonstrates that military spending is the least effective way for a government to create employment. According to the PERI study The Job Opportunity Cost of War (Garrett-Peltier, 2014), an investment of US$1 billion creates vastly different employment outcomes depending on the sector:

Sector Jobs Created per $1 Billion
| Military / Defence | ~11,200
| Clean Energy | ~16,800
| Health Care | ~17,200
| Education | ~26,700

Note: These are US figures, but the proportional relationships are economically universal. Investing the same capital in clean energy creates 50% more jobs than military spending, while education creates 138% more jobs. The AUKUS expenditure therefore represents a massive opportunity cost, diverting hundreds of billions of dollars away from sectors that would generate significantly more - and more geographically distributed - employment.

The comparison, however, understates the true cost differential. The figures above measure only direct employment — they do not account for return on investment, and this is where the divergence between military and civilian expenditure becomes most stark. AUKUS spending is, by any economic definition, sunk expenditure: the $368 billion committed to the program generates no ongoing revenue, no tradeable goods, no exportable services, and no compounding economic return. Once spent, it is gone. The submarines it produces are instruments of deterrence, not engines of productivity – this cost is truly sunk.

Furthermore, unlike AUKUS, all jobs generated by these civil projects are domestic, and the completed infrastructure provides ongoing economic returns (freight revenue, reduced congestion, productivity gains). AUKUS, by contrast, generates no revenue and no ongoing economic return.

Inland Rail provides a particularly striking contrast. At its original 2015 Business Case cost, it was the most job-efficient mega-project in Australian history (~$619,000 per job). Even after massive cost blowouts and its truncation in May 2026 (having spent ~$15 billion to deliver only the Beveridge–Parkes section), its cost-per-job sits at ~$4.3 million — still vastly more efficient than AUKUS.

Even the most expensive and complex domestic tunnelling projects (such as the Suburban Rail Loop East at $4.3 million per job) generate employment at less than one-quarter the cost of AUKUS.

The inefficiency of AUKUS job creation is starkly highlighted when compared to major domestic civil infrastructure projects. While state infrastructure projects are highly capital-intensive, their cost-per-job metrics remain a fraction of the AUKUS program.

3.3 Comparison with Domestic Infrastructure Projects

By contrast, the alternative civilian investments represented in the PERI table are productive expenditures that generate compounding economic returns over time. A dollar invested in clean energy infrastructure produces electricity that is sold, reducing energy costs for households and industry, generating tax revenue, and enabling further investment. A dollar invested in health care reduces the economic burden of preventable illness, increases workforce participation, and extends productive working lives. A dollar invested in education raises lifetime earnings, increases tax receipts, drives innovation, and generates the skilled workforce that underpins long-run economic growth.

Military capital expenditure, by contrast, carries a fiscal multiplier consistently estimated below 1.0 in peacetime economies. A 2011 study by Barro and Redlick found the US defence spending multiplier to be approximately 0.4–0.5 — meaning that for every dollar of military spending, GDP increases by only 40 to 50 cents. The Stockholm International Peace Research Institute (SIPRI) has noted that this low multiplier is a consistent feature of military spending across OECD economies, reflecting the capital-intensive, import-dependent, and security-restricted nature of defence procurement.

In practical terms, this means that the $368 billion committed to AUKUS will not only create fewer jobs than equivalent civilian investment — it will generate no ongoing economic return to offset that cost, while the roads not built, the hospitals not staffed, the teachers not trained, and the clean energy not generated represent a permanent and compounding loss to the Australian economy. The 20,000 AUKUS jobs are a one-time employment figure attached to a program that, unlike every alternative use of that capital, produces nothing that can be sold, exported, or reinvested.

3.4 The "Cathedral in the Desert" Phenomenon

Proponents of AUKUS often cite the potential for broader regional economic revitalisation. However, Professor Al Rainnie argues in the Journal of Australian Political Economy that advanced military manufacturing often results in a "Cathedral in the Desert." Using the UK submarine building hub of Barrow-in-Furness as a case study, Rainnie notes that despite 60 years of continuous submarine production by BAE Systems, the town still suffers from population decline, lower-than-average educational attainment, and negative salary growth. The highly specialised, security-cleared nature of nuclear submarine construction means there are very few "spin-off" benefits or linkages to the broader local economy.

3.5 The Skills Shortage Crisis

Australia is currently experiencing its lowest unemployment rate in 50 years and acute shortages in STEM, engineering, and traditional trades. The AUKUS program requires the exact highly skilled workers that are already in deficit across the broader economy. Rather than creating new jobs from a pool of unemployed workers, AUKUS will largely cannibalise skilled labour from other vital sectors, including the renewable energy transition, housing construction, and civil infrastructure. The US Studies Centre notes that Australia has the unique challenge of "starting from scratch" to build a nuclear-certified workforce in an already constrained labour market.

4. The Overseas Workforce: Subsidising US and UK Industry

While the Australian Government promotes the 20,000 domestic jobs, the AUKUS agreement will be a significant driver of employment in the United Kingdom and the United States, directly subsidised by Australian taxpayers. Australia has committed approximately $4.6 billion to the UK submarine industrial base and $3 billion to the US submarine industrial base to expand their capacity to deliver the AUKUS Optimal Pathway (see UK MoD, A National Endeavour, April 2026 and Breaking Defense, September 2023).

United Kingdom (BAE Systems & Rolls-Royce)

The Australian financial contribution is directly facilitating workforce expansion in the UK. Rolls-Royce confirmed that the expansion work at their Raynesway site, jointly funded by the UK MoD and the Australian Department of Defence, will create over 1,000 new jobs in Derby (see The Guardian, March 2024). Furthermore, the UK Ministry of Defence projects that the SSN-AUKUS program will create more than 7,000 new jobs across the UK supply chain (see UK MoD, December 2025).

United States (General Dynamics & HII)

The US submarine industrial base is currently in a workforce crisis. Australia's $3 billion injection is designed to alleviate bottlenecks, effectively funding the recruitment and retention of American shipyard workers in Connecticut, Rhode Island, and Virginia to ensure the delivery of the Virginia-class vessels promised in Phase 2. The Congressional Research Service confirms that the $3 billion is directed to the US submarine industrial base (SIB) to accelerate production capacity.

5. Phased Incremental AUKUS Jobs Forecast (2023–2040+)

The following table provides an indicative, year-by-year forecast of the incremental new jobs generated specifically by Australian expenditure. This isolates the growth driven by the AUKUS partnership from the baseline employment and domestic growth of the UK and US submarine programs. Figures are synthesised from the Australian Submarine Agency, UK Parliament Research Briefing CBP-9843, US Navy NAVSEA, and US Studies Centre workforce analysis.

NOTE:

All figures show projected total jobs, at each milestone, attributable to Australian AUKUS expenditure above pre-AUKUS baselines.

The majority of the claimed 20,000 jobs are medium term during the construction phase.

The projections never exceed ~8,500 at any specific time.

Year / Phase Milestone Australia
(Direct Jobs) UK
No. of jobs funded by Aust USA
No of jobs funded by Aust Total Overseas
Jobs funded by Aust
| 2023–2026 | Phase 1 Initiation: Early infrastructure planning; UK/US design work accelerates. | ~1,000 | ~1,000
(Rolls-Royce/BAE early ramp-up) | ~1,000
(Initial deployment of $3B investment) | ~2,000
| 2027 | SRF-West Commences: UK/US rotational presence at HMAS Stirling. | ~1,500 | ~1,500 | ~1,500 | ~3,000
| 2030 | Osborne Construction:
Shipyard infrastructure build; UK begins SSN-AUKUS build. | ~4,500 | ~3,000
(SSN-A design & components) | ~3,000
(Accelerated Virginia-class production) | ~6,000
| 2032 | Phase 2:
First Virginia-class transferred to Australia. | ~5,000 | ~4,500 | ~5,000
(Peak effort to deliver Virginia-class) | ~9,500
| 2035 | Phase 3:
Australian SSN-AUKUS construction begins at Osborne. | ~6,500 | ~6,000 | ~4,000 | ~10,000
| 2040+ | Peak Operations:
First Australian SSN-AUKUS delivered; UK deliveries ongoing. | ~8,500 | ~7,000
(Peak SSN-AUKUS supply chain jobs) | ~3,000 | ~10,000

Key Observation:

By isolating the incremental jobs created by Australian expenditure, the data confirms that a substantial portion of the employment generated by the $368 billion program will be realised in overseas industrial bases. Even at the absolute peak of Australian production in the 2040s (8,500 industrial jobs), the Australian taxpayer will be directly funding approximately 10,000 incremental jobs in the UK and US. The early Australian jobs (up to 2030) are predominantly in civil construction — building the Osborne yard and HMAS Stirling upgrades — not advanced submarine manufacturing.

6. Conclusion

The political narrative that AUKUS is a nation-building, job-creating economic boon for Australia is fundamentally flawed. At an estimated $18.4 million per job (Quiggin, The Conversation, 2023), it is an exceptionally inefficient method of employment generation. Furthermore, it carries a massive opportunity cost, diverting capital and scarce skilled labour away from sectors like clean energy and healthcare that yield significantly higher employment multipliers (Garrett-Peltier, PERI, 2014).

Ultimately, while Australian taxpayers will bear the $368 billion cost, a significant portion of the true "jobs bonanza" generated by this expenditure will be realised in the shipyards of Barrow-in-Furness, Derby, Connecticut, and Virginia.

References

Prime Minister of Australia. (2023). AUKUS Submarine Workforce And Industry Strategy. https://www.pm.gov.au/media/aukus-submarine-workforce-and-industry-strategy

UK Parliament. (2025). AUKUS submarine (SSN-A) program. Research Briefing CBP-9843. https://researchbriefings.files.parliament.uk/documents/CBP-9843/CBP-9843.pdf

United States Studies Centre. (2023). AUKUS inflection point: Building the ecosystem for workforce development. https://www.ussc.edu.au/aukus-inflection-point-building-the-ecosystem-for-workforce-development

Department of Defence. (2023). AUKUS submarine workforce and industry strategy. Joint Media Release. https://www.minister.defence.gov.au/media-releases/2023-03-14/aukus-submarine-workforce-industry-strategy

Australian Submarine Agency. (2025). Australia's AUKUS Submarine Industry Strategy. https://www.asa.gov.au/sites/default/files/documents/2025-03/Australias-AUKUS-Submarine-Industry-Strategy-3.pdf

Quiggin, J. (2023). $18 million a job? The AUKUS subs plan will cost Australia way more than that. The Conversation. https://theconversation.com/18-million-a-job-the-aukus-subs-plan-will-cost-australia-way-more-than-that-202026

Garrett-Peltier, H. (2014). The Job Opportunity Cost of War. PERI, Brown University. https://costsofwar.watson.brown.edu/paper/job-opportunity-cost-war-0

Rainnie, A. (2023). AUKUS, jobs and the cathedral in the desert. Journal of Australian Political Economy. https://www.ppesydney.net/content/uploads/2023/12/16-Rainnie.pdf

UK Ministry of Defence. (2026). A National Endeavour: Nuclear as part of the Defence engine for growth. https://www.gov.uk/government/publications/the-uks-nuclear-deterrent-a-national-endeavour/a-national-endeavour-nuclear-as-part-of-the-defence-engine-for-growth

Breaking Defense. (2023). Aussies to pour $3B into US nuke boat yards. https://breakingdefense.com/2023/09/aussies-to-pour-3b-into-us-nuke-boat-yards-long-lead-items-for-aukus-subs/

The Guardian. (2024). Australia's $4.6bn Aukus funding to help create more than 1,000 jobs in UK, Rolls-Royce says. https://www.theguardian.com/world/2024/mar/25/australia-aukus-funding-uk-jobs-rolls-royce

UK Ministry of Defence. (2025). UK "All In" on AUKUS submarine and tech delivery. https://www.gov.uk/government/news/uk-all-in-on-aukus-submarine-and-tech-delivery-as-partnership-powers-full-steam-ahead

Congressional Research Service. (2024). Navy Virginia-Class Submarine Program and AUKUS Submarine Acquisition. https://www.congress.gov/crs-product/RL32418

Parliamentary Budget Office. (2023). The cost of nuclear submarines. PR-2023-184. https://www.pbo.gov.au/sites/default/files/2023-05/The%20cost%20of%20nuclear%20submarines%20PDF.pdf