According to a comprehensive new report released last week by the World Economic Forum in partnership with McKinsey & Company, the global space economy is poised for explosive growth, potentially reaching $1.8 trillion by the year 2035.
The study highlights three primary trends fueling this growth: increased global connectivity, a surge in mobility needs, and a more informed populace eager for AI-driven insights.
The report categorizes the space economy into two main segments. The first, dubbed “Backbone,” includes fundamental space technologies such as satellites, launch vehicles, and GPS systems—currently accounting for about half of the space economy’s value. The second segment, referred to as “Reach,” comprises industries and services that, while not inherently space-based, rely heavily on space technology. This includes sectors like weather forecasting, parcel tracking, and food delivery services.
The “Reach” markets are expected to grow at 1.5 times the rate of the core space technology sectors, with predictions stating that by 2035, these industries will claim nearly 60% of the market share. This shift indicates a broader integration of space technology into everyday business and consumer applications, extending far beyond traditional aerospace boundaries.
One of the pivotal technologies driving this expansion is Position, Navigation, and Timing (PNT) services, enabled primarily through GPS. The report forecasts a significant 155% increase in the market size for PNT applications by 2035, underscoring their critical role in non-space industries such as logistics and transportation. Indeed, the efficiency of services ranging from ride-sharing apps like Uber to sophisticated supply chain management hinges on advanced PNT capabilities.
The analysis also points to five key industries that are expected to generate more than 60% of the growth in the space economy over the next decade, with an additional nine sectors poised to see space-related revenues hit multi-billion dollar figures. Among these, supply chain management and transportation are highlighted as particularly reliant on space-based technologies.
However, the report also cautions against potential risks that could stem from the development of terrestrial alternatives to space-based GPS systems. Such advancements could challenge the dominance of current space technologies and lead to a lower growth scenario, with the space economy expanding to only $1.4 trillion by 2035.
Despite these potential uncertainties, the report remains optimistic about the space sector’s role in addressing global challenges. From climate change mitigation to disaster response and addressing humanitarian crises, the expanding capabilities of the space economy are set to play a pivotal role in the coming years, fostering a robust industry that not only drives economic growth but also contributes significantly to solving some of the world’s most pressing issues.
