America’s Veterans Are a Defense-Tech Asset—We’re Wasting Them

Over 200,000 U.S. veterans transition out of service annually, yet the defense-tech sector faces acute talent shortages in AI, cybersecurity, and autonomous systems. Experts say veterans’ operational experience is uniquely valuable—but outdated transition programs and bureaucratic hurdles are blocking their potential.

The global defense-tech industry is undergoing a seismic shift. Artificial intelligence, autonomous systems, and cybersecurity are redefining military competition, yet the U.S. is failing to leverage its most underutilized resource: veterans. More than 200,000 servicemembers separate from active duty each year, according to the Department of Defense, while technology occupations are projected to grow twice as fast as overall employment over the next decade. The mismatch is stark: veterans possess skills no computer science curriculum can replicate—yet the existing transition system is ill-equipped to connect them with the defense-tech jobs that demand their expertise.

The problem isn’t a lack of qualified candidates. It’s a failure of translation. Veterans who have worked in signals intelligence, operated in contested communications environments, or commanded logistics chains in austere conditions bring operational insights that AI-era employers desperately need. Yet the Transition Assistance Program (TAP)—designed for an economy that has moved on—often functions as a bureaucratic checklist rather than a tailored pathway. Only about 52% of servicemembers complete the recommended one-year timeline, leaving a critical talent pool untapped.

Why Veterans Are the Perfect Fit for Defense-Tech—but Aren’t Getting Hired

The modern battlefield is no longer defined by boots on the ground. Conflicts in Ukraine, the Middle East, and the South China Sea are increasingly shaped by autonomous systems, electronic warfare, and AI-enabled targeting, according to the RAND Corporation. Yet the organizations building these systems struggle to find employees who understand both the technology and the operational environments in which it will be used.

Veterans fill this gap. A former Marine officer who transitioned into defense-tech leadership explained, “We didn’t just study modern conflict—we fought it. We understand which failure modes matter in real-world conditions, not just in a lab.” This firsthand experience is invaluable in roles where human judgment, leadership under uncertainty, and adversarial thinking are most critical—precisely the areas least susceptible to AI disruption.

Yet the disconnect persists. A 2022 report by the Center for a New American Security (CNAS) found that only 30% of veterans entering the workforce land in STEM-related fields, despite their technical training and operational experience. The issue isn’t a lack of skills—it’s a failure to translate military experience into civilian language.

How Bureaucracy Is Blocking the Pipeline

The Transition Assistance Program (TAP) was designed in an era when veterans were expected to transition into finance or consulting. Today, the defense-tech sector is the new frontier—but TAP remains stuck in the past. Statute requires counseling to begin 12 months before separation, yet the Government Accountability Office (GAO) found that 70% of servicemembers miss this threshold, and commanders routinely waive attendance—often because the program doesn’t align with modern economic needs.

The problem extends to SkillBridge, a program allowing servicemembers to train with private-sector partners during their final 180 days. Over 25,000 veterans participated in fiscal year 2025, yet GAO’s 2024 review revealed that commanders deny or discourage participation because losing personnel for 180 days is seen as a readiness hit—even though the national security benefit accrues elsewhere.

“The talent bench exists. The accounting rules are what keep commanders from releasing it.”

—Former defense-tech executive, speaking to Defense One in 2023

Defense-Tech Companies Leading the Way

While government programs lag, the private sector is already moving. Companies like Anduril and Shield AI, both co-founded by veterans, are hiring aggressively from military ranks. The MVA Foundation (MilVet Angels) backs emerging defense-tech startups—including Hermeus, Ursa Major, and Cowboy Space Corp—whose portfolios align almost precisely with the Pentagon’s mission-critical technology priorities.

What makes these models distinctive? They create a self-reinforcing cycle: carried interest from exits flows back into veteran transition and entrepreneurship programs. Palantir’s American Tech Fellowship takes this further, recruiting transitioning veterans and enlisted leaders with no tech degree required and connecting graduates directly with defense-tech employers.

Yet these efforts remain small-scale. The question is: What would it take to build this pipeline at national security-relevant levels?

How to Build the Pipeline: Three Critical Steps

1. Rebuild TAP around defense technology pipelines.

   The NSCAI and CNAS have long argued that TAP underdelivers, but the issue is deeper than workforce quality—it’s a national security routing problem. The Secretary of War should use existing authority to redirect counseling toward critical-technology tracks, strip waiver discretion below the general-officer level, and replace completion rates with 12- and 24-month placement metrics tied to commanders’ evaluations.

2. Fix SkillBridge’s throttling problem.

   Commanders deny participation because losing personnel for 180 days is seen as a readiness hit. The Department of War should change how participants are counted against unit manning, set a service-wide floor on approval rates with denials reviewable above the immediate commander, and require outcome reporting tied to placement in critical-technology sectors.

3. Signal that veteran hiring is a strategic priority.

   Emerging defense-tech companies competing for government contracts should lead—not as corporate social responsibility initiatives, but as patriotic obligations. The private sector built the bridge for veterans transitioning into finance in 2009. Now, it must do the same for defense-tech.

Veterans Are Waiting—And the Clock Is Ticking

Consider the story of a former Marine officer who deployed in Operation Phantom Fury in 2004. Eight days before the assault on Fallujah, his battalion received an attached Iraqi Army company—36 men out of an original 146, the rest having deserted. The decision was whether to lead them into combat or tuck them behind the movement. He chose to lead them from the front. What emerged was an effective fighting unit, gathering intelligence no one else could access.

This officer’s experience mirrors the broader challenge: the hardest leadership decisions aren’t about resources or capability. They’re about the will to build the bridge between what you have and what the mission demands. Today, that mission is clear: America’s defense-tech sector needs veterans—but the system isn’t showing them the way.

Next Steps: Where to Find Updates and How to Get Involved

The Department of Defense’s Transition Assistance Program (TAP) is currently undergoing reviews, with the next major update expected in Fiscal Year 2026. Meanwhile, private-sector initiatives like the MVA Foundation and Palantir Fellowship continue expanding.

Veterans seeking transition support can explore:

• VA’s TAP resources
• Military OneSource career transition tools
• Hire Heroes USA job placement
• MVA Foundation startup opportunities