Featured in the SME’s Aerospace & Defense Industry Report, 2026
Every aerospace and defense executive knows the aging workforce crisis is coming. According to PwC’s analysis of Aerospace Industries Association data, 25% of A&D workers are aged 56 or older, and a significant portion of the workforce is approaching retirement eligibility.1 Deloitte’s 2025 industry outlook reports that 25% of the workforce has more than 20 years of experience and is at or beyond eligible retirement age.2
We understand the workforce gap ahead. We comprehend the tribal knowledge likely retiring with this segment.
But here’s what most miss: the problem isn’t just who’s leaving or what they are taking with them—it’s why this knowledge is not being passed on.
The Transfer That Isn’t Happening
Your most experienced supervisors are sitting on decades of institutional knowledge. They know which supplier will actually deliver when schedules slip. They’ve debugged proprietary processes that aren’t in any manual. They understand the unwritten workarounds that keep complex programs on track. This isn’t knowledge you can automate, hire from outside, or train in a classroom.
And almost none of it is being transferred to the next generation.
Walk through any aerospace facility and you’ll hear the same strategy: “We’ve got Sarah shadowing Mike before he retires.” The assumption is that proximity equals knowledge transfer. Put the new supervisor next to the experienced one, and osmosis will do the rest.
It doesn’t work.
Not because Mike doesn’t want to help. Not because Sarah isn’t paying attention. But because Mike—despite being a brilliant supervisor with 30 years of experience—was never trained to teach what he knows.
Knowledge transfer isn’t automatic. It’s a leadership skill. It’s a natural byproduct within fertile, collaborative, and aligned organizations. And in an industry that rigorously qualifies every technical process, we leave this mission-critical capability entirely to chance.
Why This Costs More in A&D Than Anywhere Else
Manufacturing organizations across every sector face knowledge transfer challenges, but aerospace and defense operates under constraints that make the problem exponentially worse.
You rarely can hire externally to fill the gaps. Security clearances, ITAR restrictions, and proprietary processes mean you can’t just recruit experienced supervisors from outside, nor can most Tier 2 or 3 contractors afford them. Your leadership pipeline must be internal—which makes knowledge transfer non-negotiable.
Training timelines are measured in years, not months. Studies of new manager effectiveness consistently find that the first 12-18 months are critical for building confidence and competence—yet frontline leaders often receive minimal formal leadership training during this vulnerable period. This only becomes amplified in the complex, technical world of aerospace and defense where supervisor roles demand both technical expertise and leadership capability.
The cost of knowledge gaps shows up as program failures. When critical tribal knowledge walks out the door, it doesn’t announce itself as “knowledge loss.” It quietly appears as quality escapes, rework, schedule delays, audit findings, and missed contract milestones. By the time you recognize the pattern, the person who could have prevented it is already long gone.
As Deloitte’s industry analysis notes, “retirees take with them a wealth of institutional knowledge,” and companies are struggling to extract this wisdom and avoid single points of knowledge failure.3
The Root Cause No One’s Addressing
Here’s the uncomfortable truth: experienced supervisors don’t know how to transfer knowledge because they don’t exist in an ecosystem that facilitates it.
We promote people based on technical mastery and tenure, then assume they’ll naturally know how to coach others, document processes, and develop their replacements.
Teaching is a skill. Coaching is a skill. Translating decades of intuitive expertise into transferable knowledge is a skill. None of these emerge automatically from being good at your job for a long time.
The military doesn’t lose tactical knowledge every time an officer retires. Why? Because knowledge transfer is built into leadership development. Officers are trained to document, brief, and mentor as core leadership competencies—not optional nice-to-haves.
Aerospace and defense can—and must—do the same.
The Dual Solution
When you create an ecosystem that collectively develops frontline leaders in coaching, communication, and knowledge documentation as core leadership skills, you accomplish two strategic objectives at once:
First, you prepare the next generation of supervisors to actually lead—not just manage. They learn how to develop and engage their teams, not just reactively direct them.
It’s widely documented that new leaders and managers today struggle to adapt into their new roles, and that these challenges directly correlate to disengaged teams and high turnover. Training alone won’t fix this. It’s not solely a lack of knowledge issue. They need digestible knowledge with clear application pathways. They need guidance from mentors that’s intentional, not another unplanned 30-minute meeting or book club. They need mutual support from peers that breeds accountability and perseverance. It’s extremely rare to find these ingredients in organizations today.
Second, you create the infrastructure to capture institutional knowledge before it walks out the door, one that both prescriptively and naturally facilitates knowledge transfer and collaboration.
The elements above do more than improve the quality of frontline leadership. They establish neural pathways in the management of your organization. You functionally create teams and cohorts of leaders that associate and identify with each other, not those within the ranks they may have come from. This uplevels more than simply leadership. It injects communication, alignment, and collaboration across your organization—the essential ingredients of knowledge transfer. And it doesn’t wait for someone to announce their departure or retirement, it becomes an everyday function of your operation.
This isn’t about creating more paperwork. It’s about treating leadership—and knowledge transfer—with the same systematic rigor you apply to AS9100 compliance or supply chain qualification.
The Strategic Advantage
Knowledge transfer capability is becoming a competitive differentiator.
When the next major contract requires rapid scaling, when geopolitical tensions demand surge capacity, when programs accelerate and timelines compress—the companies that win will be those with deep leadership benches and robust knowledge infrastructure.
Your competitors are facing the same aging workforce crisis you are. The ones who treat knowledge transfer as a systematic leadership capability—not a retirement party conversation—will have the institutional depth to scale when it matters most.
The question isn’t whether your experienced supervisors are retiring. It’s whether what they know is leaving with them—or staying behind to fuel the next generation.
Read the full article and learn more about SME at AdvancedManufacturing.Org:
References
1PwC, “What Workforce Trends Are Facing the A&D Industry?,” accessed January 15, 2026, https://www.pwc.com/us/en/industries/industrial-products/library/aerospace-defense-workforce-trends.html.
2Lindsey Berckman et al., “2025 Aerospace and Defense Industry Outlook,” Deloitte Insights, October 23, 2024 (updated July 2025), https://www.deloitte.com/us/en/insights/industry/aerospace-defense/aerospace-and-defense-industry-outlook/2025.html.
3Berckman et al., “2025 Aerospace and Defense Industry Outlook.”
