Commenting on the proposed £29.8bn merger of BAE Systems and EADS, Prospect General Secretary Designate Mike Clancy said: "Private sector defence contractors have been under immense pressure because of cutbacks in government spending on defence.

"Whether the news of this merger brings reassurance or not for the workers depends on whether the new company will go for consolidation or growth."

He added: "We are seeking early talks with the companies about the future strategic positioning of the business. We are puzzled as to why BAE has decided to merge with EADS, even though it cut formal ownership ties with Airbus only a few years ago.

"BAE Systems is a prime contractor of the Ministry of Defence, and this move clearly reflects fears about future profitability of those arrangements as defence markets shrink."

The news follows demands from Prospect in January for BAE Systems to come clean about its plans for the future of its Maritime division in Portsmouth, where the union represents 300 specialists. In June Prospect criticised the closure of BAE's Global Combat Systems manufacturing facility in Newcastle.

Clancy said: "Losing hundreds more highly skilled staff from the defence industry will be bad for the individuals affected, bad for local communities and bad for the long-term health of the UK's defence infrastructure."