The economy of Wales (
Welsh
Welsh may refer to:
Related to Wales
* Welsh, referring or related to Wales
* Welsh language, a Brittonic Celtic language spoken in Wales
* Welsh people
People
* Welsh (surname)
* Sometimes used as a synonym for the ancient Britons (Celtic peop ...
: ''Economi Cymru'') refers to the production and consumption of goods and services and the supply of money in
Wales
Wales ( cy, Cymru ) is a Countries of the United Kingdom, country that is part of the United Kingdom. It is bordered by England to the Wales–England border, east, the Irish Sea to the north and west, the Celtic Sea to the south west and the ...
.
The percentage of all individuals, living in relative income poverty in Wales in 2016–17 was 23%, compared to 22% in England, and only 19% in Scotland and Northern Ireland. More than one in five people in Wales were living in poverty between 2001 and 2016.
However, in 2018, according to OECD and Eurostat data,
gross domestic product
Gross domestic product (GDP) is a money, monetary Measurement in economics, measure of the market value of all the final goods and services produced and sold (not resold) in a specific time period by countries. Due to its complex and subjec ...
(GDP) in Wales was £75 billion, an increase of 3.3% from 2017. GDP per head in Wales in 2018 was £23,866, an increase of 2.9% on 2017. In 2019 Wales generated tax revenue of £27bn, which is around 36% of GDP, and has expenditure of £40.1bn, leaving an deficit of £13.1bn.
Research and analysis conducted by Professor John Doyle, Dublin City University showed that the fiscal balance of £2.6bn in the "early days of an
independent Wales" would be approximately £2.6bn which is far less than the often quoted figure of 13.5bn. This equates to under 3.4% of
GDP, which compares to an average of 3.2% for countries in the OECD
rganization for Economic Co-operation and Developmentin 2019.
Indicators of economic growth
This table shows the economic growth indicators over the last 30 years in Wales.
Economic sectors (A-Z)
Agriculture
In 2003, agriculture contributed £418 million to Welsh GVA, or 1.1% (including subsidies).
[Welsh Assembly Government (2007) Rural Development Plan for Wales, 2007 – 2013: The Strategic Approach] 1.6m hectares (around 77% of Wales' total land area) is used for agricultural production and an estimated 57,500 people are directly employed in the sector.
Farming is dominated by beef,
sheep
Sheep or domestic sheep (''Ovis aries'') are domesticated, ruminant mammals typically kept as livestock. Although the term ''sheep'' can apply to other species in the genus ''Ovis'', in everyday usage it almost always refers to domesticated s ...
and the dairy sector, with the
arable sector accounting for 10% of agricultural output.
Average farm size is 30–40 hectares, small by UK standards, and dominated by family-run enterprises.
Banking and finance
The
Development Bank of Wales
The Development Bank of Wales (branded as simply Banc; cy, Banc Datblygu Cymru) is a Welsh development bank that provides financial support for Welsh businesses and is owned by the Welsh Government. The bank provides loans for businesses to st ...
is a national Welsh investment bank that was founded by the Welsh Government. It invests in businesses, particularly start ups by providing growth capital.
Banc Cambria is a proposed national Welsh community bank currently under development and aimed to be operating in Wales by 2023.
Building societies in Wales includes the
Principality Building Society
The Principality Building Society ( cy, Cymdeithas Adeiladu'r Principality) is a building society based in Cardiff, Wales. With assets of £10bn it is the largest building society in Wales and the sixth largest in the United Kingdom. Principali ...
,
Monmouthshire Building Society and the
Swansea Building Society
The Swansea Building Society, ( cy, Cymdeithas Adeiladu'r Abertawe), is an independent mutual building society based in Swansea, Wales. It is a member of the Building Societies Association.
The Society was founded in 1923 by local estate agent Jo ...
.
Welsh insurance companies include
Admiral
Admiral is one of the highest ranks in some navies. In the Commonwealth nations and the United States, a "full" admiral is equivalent to a "full" general in the army or the air force, and is above vice admiral and below admiral of the fleet, ...
and
Thomas Carroll.
Education
Education in Wales differs in certain respects from education elsewhere in the United Kingdom. For example, a significant minority of students all over
Wales
Wales ( cy, Cymru ) is a Countries of the United Kingdom, country that is part of the United Kingdom. It is bordered by England to the Wales–England border, east, the Irish Sea to the north and west, the Celtic Sea to the south west and the ...
are educated either wholly or largely through the medium of
Welsh
Welsh may refer to:
Related to Wales
* Welsh, referring or related to Wales
* Welsh language, a Brittonic Celtic language spoken in Wales
* Welsh people
People
* Welsh (surname)
* Sometimes used as a synonym for the ancient Britons (Celtic peop ...
: in 2014/15, 15.7% of children and young people received Welsh-medium education – a drop from the 15.9% in 2010/11.
Energy
The largest pumped storage power station in Europe">Dinorwig Power Station largest pumped storage power station in EuropeIn 2018, the annual production of electricity in Wales was 30.2 TWh and consumed 14.9 TWh, which means that Wales generates twice as much electricity as it consumes and is a net exporter of electricity to England, Ireland and Europe.
In the same year, 25% was from renewable sources, up from 22% in 2017. Electricity generation encompasses a broad mix of technologies including Coal (e.g.
Aberthaw
Aberthaw ( cy, Aberddawan) is an area containing the villages of East Aberthaw and West Aberthaw, on the coast of South Wales about west of Barry. It is home to Aberthaw Cement Works, Aberthaw Lime Works, and Aberthaw Power Station, a coal power ...
), Gas (e.g.
Baglan Bay
Baglan Bay ''(Welsh: Bae Baglan)'' is a part of the Swansea Bay coastline and a district of Neath Port Talbot county borough, Wales. Baglan Bay is also the name of a local government community. Baglan Bay is served by the M4 Motorway and the A48 ...
), Wind (
Cefn Croes
Cefn Croes is a wind farm in Ceredigion, Wales. It is located in the Cambrian Mountains on Cefn Croes mountain, 573m (1,880 ft) south of the A44 road between Aberystwyth and Llangurig, in west Wales. The construction of the wind farm commenc ...
), hydro-electricity (
Dinorwig
Dinorwig sometimes spelled Dinorwic ( ; ; ), is a village located high above Llyn Padarn, near Llanberis, in Wales. The name is shared with the fort of Dinas Dinorwig, also within the community of Llanddeiniolen, on a foothill from Dinorwig v ...
), solar thermal/PV and biomass electricity.
In 2017, the Welsh Government announced a target of meeting 70% of Wales’ electricity demand from Welsh renewable electricity sources by 2030. By 2018, Wales generated over 3,864 MW renewable energy from 68,728 projects.
In June 2018 the Welsh Government backed the
Tidal Lagoon Swansea Bay
Tidal Lagoon Swansea Bay was a proposed tidal lagoon power plant that was to be constructed in Swansea Bay off the south coast of Wales, United Kingdom. Development consent was granted by the UK government in June 2015, and in June 2018 the Wels ...
project with an offer to invest £200 million; the project would see the world's largest tidal hydro-electricity plant. However, in June 2018, the UK Government refused to back the plan due to it being shown to be not viable by an indepentent report.
In 2021, the Welsh government said that more than half the country's energy needs were being met by renewable sources, 2 percent of which was from 363
hydropower
Hydropower (from el, ὕδωρ, "water"), also known as water power, is the use of falling or fast-running water to Electricity generation, produce electricity or to power machines. This is achieved by energy transformation, converting the Pot ...
projects.
Food and drink
The food and drink sector is classed as a priority economic sector in Wales. It involves 170,000 people that contribute to gross sales of £17.3 billion. The largest private sector employer is the Cardiff brewer and pub owner
Brains Brewery
Brains (S. A. Brain & Company Ltd.) is a regional brewery based in Cardiff, Wales. It was founded in 1882 by Samuel Arthur Brain. The company controls more than 250 pubs in South Wales (particularly in Cardiff), Mid Wales and the West Country. Th ...
, which employs nearly 1,800 people.
Forestry
Forest and woodland makes up 14% of the land area of Wales and there are 4,000 jobs and in
forest-based industries.
Healthcare
Healthcare in Wales is mainly provided by the Welsh public health service,
NHS Wales. NHS Wales provides healthcare to all permanent residents that is free at the point of need and paid for from general taxation. Health is a matter that is
devolved, and considerable differences are now developing between the public healthcare systems in the different countries of the
United Kingdom
The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the continental mainland. It comprises England, Scotland, Wales and North ...
, collectively the
National Health Service
The National Health Service (NHS) is the umbrella term for the publicly funded healthcare systems of the United Kingdom (UK). Since 1948, they have been funded out of general taxation. There are three systems which are referred to using the " ...
(NHS). Though the public system dominates healthcare provision, private health care and a wide variety of alternative and complementary treatments are available for those willing to pay.
Housing and construction
In November 2008, the average price of a house in Wales was £126,181, a fall of 11.7% since the previous year. As of 2022 the average house price in Wales is around £251,000. The average house price in England and Wales as a whole was £161,883. In August 2008, average house prices in Wales ranged from £109,000 in
Blaenau Gwent
Blaenau Gwent (; ) is a county borough in the south-east of Wales. It borders the unitary authority areas of Monmouthshire and Torfaen to the east, Caerphilly to the west and Powys to the north. Its main towns are Abertillery, Brynmawr, Ebbw ...
to £238,000 in
Monmouthshire
Monmouthshire ( cy, Sir Fynwy) is a county in the south-east of Wales. The name derives from the historic county of the same name; the modern county covers the eastern three-fifths of the historic county. The largest town is Abergavenny, with ...
.
Manufacturing
Other manufacturing industries not listed here include oil refining and tool making.
Aerospace
Today Airbus Broughton employs over 6,500 people, mostly in manufacturing roles. The site is responsible for the wing assembly for all Airbus aircraft, with the exception of the Chinese
A320s (these wings are assembled in China) and the A400M (assembled in Filton).
General Electric (GE) on Caerphilly Road, Nantgarw in Wales handles the world’s largest and most fuel efficient aviation engine, GE9X.
Automotive
The St Athans Aston Martin plant in South Wales created 750 new jobs in 2016. It had a series of recruitment events in South Wales that gained over 3,000 applications. The first technicians were recruited to work on the new DB11 at Aston Martin's Gaydon Headquarters, training for the highly-skilled jobs to work in St Athan.
Electronics
During the 1980s and 1990s, a major growth sector in manufacturing was the
electronics
The field of electronics is a branch of physics and electrical engineering that deals with the emission, behaviour and effects of electrons using electronic devices. Electronics uses active devices to control electron flow by amplification ...
industry with over 130 North American and 35 Japanese companies establishing operations in Wales.
Medical
Creo Medical, based in Chepstow, is an emerging Medical Technology company is developing medical technologies with the aim of substantially benefiting the medical community and vastly improving the outcomes of a range of medical procedures. RotoMedical has emerged as a leading Welsh manufacturer of PPE and medical equipment. The company produces specifically industrial gauges, ultrasonic level transmitters, temperature probes and pressure measurement equipment.
Metals
Metal ore
Ore concentrate, dressed ore or simply concentrate is the product generally produced by metal ore mines. The raw ore is usually ground finely in various comminution operations and gangue (waste) is removed, thus concentrating the metal component. ...
refining is a long established industry in Wales. As of 2007,
Corus had manufacturing facilities at
Port Talbot,
Llanwern,
Newport
Newport most commonly refers to:
*Newport, Wales
*Newport, Rhode Island, US
Newport or New Port may also refer to:
Places Asia
*Newport City, Metro Manila, a Philippine district in Pasay
Europe
Ireland
*Newport, County Mayo, a town on the ...
,
Trostre
Pemberton is an area situated east of Llanelli in Carmarthenshire, Wales. It is part of the Llanelli Rural (Welsh-Llanelli Wledig) community bordering Llanelli and the villages of Cwmcarnhywel, Dafen, Cefncaeau and the outskirts of Llanelli tow ...
,
Shotton,
Ammanford
Ammanford ( cy, Rhydaman) is a town and community in Carmarthenshire, Wales, with a population of 5,411 at the 2011 census. It is a former coal mining town. The built-up area had a population of 7,945 with the wider urban area even bigger.
Acco ...
,
Pontardulais
Pontarddulais (), also known as Pontardulais (), is both a community and a town in Swansea, Wales. It is northwest of the city centre. The Pontarddulais ward is part of the City and County of Swansea. Pontarddulais adjoins the village of Hendy ...
,
Tafarnaubach and
Caerphilly
Caerphilly (, ; cy, Caerffili, ) is a town and community in Wales. It is situated at the southern end of the Rhymney Valley.
It is north of Cardiff and northwest of Newport. It is the largest town in Caerphilly County Borough, and lies wit ...
, although only the
Port Talbot Steelworks remains as a major integrated steelmaking plant. Pro Steel Engineering is a steel specialist company based in Wales operting internationally. The company has delivered high-profile work, including collaborative projects such as the London Olympic Stadium Transformation and ICC Wales’ 22 tonne steel Welsh dragon. Nearly all the
tinplate and much of the aluminium produced in the UK are made in Welsh plants.
TIMET
Titanium Metals Corporation, or most commonly referred to as TIMET, a shortened version of "TItanium METals" that is a registered company trademark. TIMET, founded in 1950, is an American manufacturer of titanium-based metals products, focusing ...
has a plant in
Waunarlwydd,
Swansea
Swansea (; cy, Abertawe ) is a coastal city and the second-largest city of Wales. It forms a principal area, officially known as the City and County of Swansea ( cy, links=no, Dinas a Sir Abertawe).
The city is the twenty-fifth largest in ...
, which is one of the world's major suppliers of
titanium
Titanium is a chemical element with the symbol Ti and atomic number 22. Found in nature only as an oxide, it can be reduced to produce a lustrous transition metal with a silver color, low density, and high strength, resistant to corrosion in ...
for jet engine blades and medical applications.
Marine and Fisheries
The Welsh
fishing industry
The fishing industry includes any industry or activity concerned with taking, culturing, processing, preserving, storing, transporting, marketing or selling fish or fish products. It is defined by the Food and Agriculture Organization as including ...
is the smallest in the UK, with about 1,000 full-time and 400 part-time fishermen.
Commercial fishing in Wales employs approximately 600 people
full-time
Full-time or Full Time may refer to:
* Full-time job, employment in which a person works a minimum number of hours defined as such by their employer
* Full-time mother, a woman whose work is running or managing her family's home
* Full-time fat ...
and is valued at . 92% of Welsh fishing vessels are designated small-scale. The minor role that the Welsh industry holds is largely due to its geographical isolation, weak distribution networks and the demise of the Wales distant-water fleet from the 1960s onwards.
Retail
The retail sector is the largest private sector employer in Wales. The sector has 114,000 employees which accounts for 6.0% of Welsh
GVA (gross value added). The retail sector in Wales is considered highly valuable by the Welsh government.
Science and technology
* From 2010 to 2018, Welsh researchers accounted for 4% of UK publications and 0.3% of global scholarly output.
* Wales is the most efficient of all its comparators in terms of output per expenditure.
* Wales' research and development funding now accounts for 62% of total expenditure.
* Wales's citation impact has risen to 1.8. This is 80% above the global average and 13% above the UK average.
* Wales' proportion of top 5% of the most cited publications is twice the global average.
Services & high value-added employment
In recent years, the
service
Service may refer to:
Activities
* Administrative service, a required part of the workload of university faculty
* Civil service, the body of employees of a government
* Community service, volunteer service for the benefit of a community or a pu ...
sector in Wales has seen above average growth; however in 2005 its share of GVA was small compared with most other regions of the UK.
Wales does not have a favourable occupational structure, and a relatively high proportion of jobs are in
public administration
Public Administration (a form of governance) or Public Policy and Administration (an academic discipline) is the implementation of public policy, administration of government establishment (public governance), management of non-profit establ ...
,
health
Health, according to the World Health Organization, is "a state of complete physical, mental and social well-being and not merely the absence of disease and infirmity".World Health Organization. (2006)''Constitution of the World Health Organiza ...
and
education
Education is a purposeful activity directed at achieving certain aims, such as transmitting knowledge or fostering skills and character traits. These aims may include the development of understanding, rationality, kindness, and honesty. Va ...
. Compared to more prosperous parts of the UK, Wales lacks
high value added service sector employment in sectors such as
finance
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of fina ...
, business services and
research and development
Research and development (R&D or R+D), known in Europe as research and technological development (RTD), is the set of innovative activities undertaken by corporations or governments in developing new services or products, and improving existi ...
.
This is partly due to a weaker
agglomeration effect, due to the small size of towns and cities in Wales compared to regions within the UK and small countries.
[Economic Futures for Wales](_blank)
/ref> Wales like Northern Ireland has relatively few high value-added employment in sectors such as finance and research and development, attributable in part to a comparative lack of 'economic mass' (i.e. population) – Wales lacks a large metropolitan centre. The lack of high value-added employment is reflected in lower economic output per head relative to other regions of the UK – in 2002 it stood at 90 per cent of the EU25 average and around 80 per cent of the UK average. In June 2008, Wales became the first nation to be awarded Fairtrade Status.
Telecommunications
On 28 November 2006, a trial of a new telecommunications
Telecommunication is the transmission of information by various types of technologies over wire, radio, optical, or other electromagnetic systems. It has its origin in the desire of humans for communication over a distance greater than that fe ...
network
Network, networking and networked may refer to:
Science and technology
* Network theory, the study of graphs as a representation of relations between discrete objects
* Network science, an academic field that studies complex networks
Mathematics
...
technology was rolled out in the village of Wick in the Vale of Glamorgan
The Vale of Glamorgan ( cy, Bro Morgannwg ), often referred to as The Vale, is a county borough in the south-east of Wales. It borders Bridgend County Borough to the west, Cardiff to the east, Rhondda Cynon Taf to the north, and the Bristol C ...
. The new network BT 21CN The 21st Century Network (21CN) programme is the data and voice network transformation project, under way since 2004, of the UK telecommunications company BT Group plc. It was intended to move BT's telephone network from the AXE/ System X Public Sw ...
, offers broadband data transfer speeds of up to 24Mbit/s.
Trading
Excluding intra UK trade, the European Union
The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been des ...
and the United States constitute the largest markets for Wales's exports. Recently, with the high rates of growth in many emerging economies of southeast Asia and the Middle East such as China, UAE
The United Arab Emirates (UAE; ar, اَلْإِمَارَات الْعَرَبِيَة الْمُتَحِدَة ), or simply the Emirates ( ar, الِْإمَارَات ), is a country in Western Asia (The Middle East). It is located at th ...
and Singapore, there has been a drive towards marketing Welsh products and manufactured goods in these countries, with China and Qatar
Qatar (, ; ar, قطر, Qaṭar ; local vernacular pronunciation: ), officially the State of Qatar,) is a country in Western Asia. It occupies the Qatar Peninsula on the northeastern coast of the Arabian Peninsula in the Middle East; it sh ...
entering the top ten destinations for Welsh exports in 2013.
The total value of international exports from Wales in 2015 was estimated at £12.2 billion (2014: £13.4 billion). The top five exporting industries in 2013 were power generating machinery £4.0 billion (2013: £4.2 billion), petroleum, petroleum products & related materials £2.6 billion (2013: £3.8 billion), Iron & Steel £1.288 billion (2013: £1.3 billion), electric machinery £0.69 billion (2013: £0.7 billion), and professional and scientific services £0.346 billion (2013: £0.353 billion).
Tourism
With its mountainous landscape and numerous sandy beaches, Wales attracts significant tourism
Tourism is travel for pleasure or business; also the theory and practice of touring (disambiguation), touring, the business of attracting, accommodating, and entertaining tourists, and the business of operating tour (disambiguation), tours. Th ...
. In 2002, nearly 13 million trips of one night or more were made in Wales, generating expenditure of £1.8 billion. Of these trips, 11.9 million were made by UK residents and 0.9 million by overseas visitors. Cardiff is the most popular destination for visitors to Wales, with 11.7 million visitors in 2006.
In 2014, over 10 million domestic trips of one night or more were made in Wales, generating expenditure of £1.7 billion.
During 2020, and well into 2021, the restrictions and lockdowns necessitated by the COVID-19 pandemic
The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identif ...
affected all sectors of the economy and "tourism and hospitality suffered notable losses from the pandemic" across the UK. As of 6 April 2021, visitors from "red list" countries were still not allowed to enter unless they were UK residents. Restrictions will "likely be in place until the summer", one report predicted, with June being the most likely time for tourism from other countries to begin a rebound. On 12 April 2021, many tourist facilities were still closed in Wales but non-essential travel between Wales and England was finally permitted. Wales also allowed non-essential retail stores to open.
The outdoor areas of restaurants and pubs would reopen on 26 April 2021. Gyms, leisure centres and fitness facilities were to stay closed until 4 May.
Transport
Rail
Wales is one of the few countries in the world where you must travel through another country when traveling from the capital to the furtherst point of that country, with nearly all line going East to West, rather than north–south. Rail infrastructure is not devolved to Wales; Wales has 11% of the rail network of Wales and England and 5.3% of the population, however the income received from Westminster in 2019-20 was 1.6%. In 2021 there were no electrified lines in Wales.
Many major English cities, however, have direct rail connections to Wales. The South Wales coast as far as Swansea
Swansea (; cy, Abertawe ) is a coastal city and the second-largest city of Wales. It forms a principal area, officially known as the City and County of Swansea ( cy, links=no, Dinas a Sir Abertawe).
The city is the twenty-fifth largest in ...
is served by the South Wales Main Line which passes under the Severn Estuary through the Severn Tunnel; the West Wales Line connects it to the Pembrokeshire ferry ports. The main north–south railway line is the Welsh Marches Line between Newport
Newport most commonly refers to:
*Newport, Wales
*Newport, Rhode Island, US
Newport or New Port may also refer to:
Places Asia
*Newport City, Metro Manila, a Philippine district in Pasay
Europe
Ireland
*Newport, County Mayo, a town on the ...
and Shrewsbury
Shrewsbury ( , also ) is a market town, civil parish, and the county town of Shropshire, England, on the River Severn, north-west of London; at the 2021 census, it had a population of 76,782. The town's name can be pronounced as either 'Sh ...
enabling direct services between Holyhead
Holyhead (,; cy, Caergybi , "Cybi's fort") is the largest town and a community in the county of Isle of Anglesey, Wales, with a population of 13,659 at the 2011 census. Holyhead is on Holy Island, bounded by the Irish Sea to the north, and is ...
and Cardiff
Cardiff (; cy, Caerdydd ) is the capital and largest city of Wales. It forms a principal area, officially known as the City and County of Cardiff ( cy, Dinas a Sir Caerdydd, links=no), and the city is the eleventh-largest in the United Kingd ...
. An urban rail network, serving 81 stations, is focused on the capital, Cardiff. Mid and North Wales (away from the coast) are served by a limited number of branch lines, some of which connect with revived narrow gauge railways.
Roads
The M4 motorway
The M4, originally the London-South Wales Motorway, is a motorway in the United Kingdom running from west London to southwest Wales. The English section to the Severn Bridge was constructed between 1961 and 1971; the Welsh element was largely ...
, A449
The A449 is a major road in the United Kingdom. It runs north from junction 24 of the M4 motorway at Newport in South Wales to Stafford in Staffordshire.
The southern section of the road, between Ross on Wye and Newport forms part of the tru ...
, A465
The A465 is a trunk road that runs from Bromyard in Herefordshire, England to Llandarcy near Swansea in South Wales. The western half is known officially as the Neath to Abergavenny Trunk Road, but the section from Abergavenny to the Vale of N ...
, A48, A40, and A477 in the south, the A55 and A483 plus border links in the north, form part of the Trans-European Road Network.[National Assembly for Wales 2001, The Transport Framework for Wales]
Ports
Wales has ten main commercial ports. Milford Haven
Milford Haven ( cy, Aberdaugleddau, meaning "mouth of the two Rivers Cleddau") is both a town and a community in Pembrokeshire, Wales. It is situated on the north side of the Milford Haven Waterway, an estuary forming a natural harbour that has ...
is the UK's largest energy port and is capable of delivering 30% of the UK gas demand. Newport
Newport most commonly refers to:
*Newport, Wales
*Newport, Rhode Island, US
Newport or New Port may also refer to:
Places Asia
*Newport City, Metro Manila, a Philippine district in Pasay
Europe
Ireland
*Newport, County Mayo, a town on the ...
is the busiest UK port for iron and steel and Port Talbot is the third busiest for ores.
Airports
Cardiff Airport
Cardiff Airport ( cy, Maes Awyr Caerdydd) is the only airport offering commercial passenger services in Wales. It has been under the ownership of the Welsh Government since March 2013, operating at an arm's length as a commercial business. Pa ...
is the only Welsh airport offering international scheduled flights. In 2007, Anglesey Airport became a public airport. The UK Government's Treasury has repeatedly refused Welsh Government
calls to devolve Air Passenger Duty, as doing so would give Cardiff Airport an advantage over Bristol Airport.
Water
Dŵr Cymru Welsh Water
Dŵr Cymru Welsh Water is a not-for-profit company which supplies drinking water and wastewater services to most of Wales and parts of western England that border Wales. In total, it serves around 1.4 million households and businesses and around t ...
is a not-for-profit company which supplies drinking water and wastewater services to most of Wales and parts of western England that border Wales. In total, it serves around 1.4 million households and businesses and around three million people - and supplies nearly 830 million litres (180 million gallons) of drinking water per day. Hafren Dyfrdwy
(, after the two main rivers in its region) is a water company providing water and wastewater treatment services, operating in north east and mid Wales. It provides water only in Wrexham and parts of Denbighshire and Flintshire and both water ...
is a company providing water
Water (chemical formula ) is an inorganic, transparent, tasteless, odorless, and nearly colorless chemical substance, which is the main constituent of Earth's hydrosphere and the fluids of all known living organisms (in which it acts as a ...
and wastewater treatment
Wastewater treatment is a process used to remove contaminants from wastewater and convert it into an effluent that can be returned to the water cycle. Once returned to the water cycle, the effluent creates an acceptable impact on the environme ...
services, operating in north east and mid Wales. It provides water only in Wrexham
Wrexham ( ; cy, Wrecsam; ) is a city and the administrative centre of Wrexham County Borough in Wales. It is located between the Welsh mountains and the lower Dee Valley, near the border with Cheshire in England. Historically in the count ...
and parts of Denbighshire
Denbighshire ( ; cy, Sir Ddinbych; ) is a county in the north-east of Wales. Its borders differ from the historic county of the same name. This part of Wales contains the country's oldest known evidence of habitation – Pontnewydd (Bontnewy ...
and Flintshire and both water and wastewater in northern Powys.
Dwr Cymru Welsh Water employs more than 3,000 people.
Government spending and economic management
Currency and monetary policy
The currency used in Wales is the Pound, represented by the symbol '' £''. The Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
is the central bank
A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union,
and oversees their commercial banking system. In contrast to a commercial bank, a central ba ...
, responsible for issuing currency, and retains responsibility for monetary policy
Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money supply, often a ...
and is the central bank of the UK. The Royal Mint
The Royal Mint is the United Kingdom's oldest company and the official maker of British coins.
Operating under the legal name The Royal Mint Limited, it is a limited company that is wholly owned by His Majesty's Treasury and is under an exclus ...
, which issues the coinage circulated over the whole of the UK, has been based at a single site in Llantrisant
Llantrisant (; "Parish of the Three Saints") is a town in the county borough of Rhondda Cynon Taf, within the historic county boundaries of Glamorgan, Wales, lying on the River Ely and the Afon Clun. The three saints of the town's name are SS ...
, Rhondda Cynon Taf since 1980, having progressively transferred operations from their Tower Hill
Tower Hill is the area surrounding the Tower of London in the London Borough of Tower Hamlets. It is infamous for the public execution of high status prisoners from the late 14th to the mid 18th century. The execution site on the higher grou ...
, London site from 1968.
Taxation and public spending
The Welsh Government established Independent Commission on Funding and Finance for Wales
The Independent Commission on Funding and Finance for Wales, also known as The Holtham Commission, was established by Rhodri Morgan (First Minister for Wales), Ieuan Wyn Jones (Deputy First Minister for Wales) and Andrew Davies (Minister for Fin ...
(the Holtham Commission) which looked at funding devolved public services in Wales, and possible alternative mechanisms. In 2011, the Commission on Devolution in Wales
The Commission on Devolution in Wales ( cy, Comisiwn ar Ddatganoli yng Nghymru), also known as the Silk Commission, was an independent commission established by Welsh Secretary Cheryl Gillan on 11 October 2011. The commission was based at the Wa ...
(the Silk Commission) was set up to review the case for the devolution of fiscal powers. This led to the , which devolved a range of provisions to the National Assembly, including powers over taxation. Fiscal and economic policy are currently reserved matters
In the United Kingdom, devolved matters are the areas of public policy where the Parliament of the United Kingdom has devolved its legislative power to the national assemblies of Scotland, Wales and Northern Ireland, while reserved matters an ...
determined at Westminster
Westminster is an area of Central London, part of the wider City of Westminster.
The area, which extends from the River Thames to Oxford Street, has many visitor attractions and historic landmarks, including the Palace of Westminster, Bu ...
, however from 2018 increased tax and borrowing powers devolved. In April 2018 the Welsh Government became responsible for three taxes: stamp duty land tax (SDLT), landfill tax and income tax. This was the first time for Wales to raise its own taxes since 1283.
Economic development
According to the Welsh Government's economic development strategy, the role of the public sector
The public sector, also called the state sector, is the part of the economy composed of both public services and public enterprises. Public sectors include the public goods and governmental services such as the military, law enforcement, infra ...
in the economy is to help create a stable and favourable business environment, promote skills and innovation (through for example apprenticeships and Design Wales), address market failure
In neoclassical economics, market failure is a situation in which the allocation of goods and services by a free market is not Pareto efficient, often leading to a net loss of economic value. Market failures can be viewed as scenarios where indiv ...
s and invest in economic infrastructure including transport and information technology. Aside from fiscal policy, energy policy, employment law, social security
Welfare, or commonly social welfare, is a type of government support intended to ensure that members of a society can meet basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refer specificall ...
and various other aspects of market regulation are reserved to the UK Government.
Public sector employment
The public sector is also an important employer in Wales. In the year ending 30 June 2008, 386,000 people (28.8% of the Welsh workforce) were employed in the public sector, with the highest number (49,000) in Cardiff
Cardiff (; cy, Caerdydd ) is the capital and largest city of Wales. It forms a principal area, officially known as the City and County of Cardiff ( cy, Dinas a Sir Caerdydd, links=no), and the city is the eleventh-largest in the United Kingd ...
and the highest percentage of the local workforce (35.4%) in Swansea
Swansea (; cy, Abertawe ) is a coastal city and the second-largest city of Wales. It forms a principal area, officially known as the City and County of Swansea ( cy, links=no, Dinas a Sir Abertawe).
The city is the twenty-fifth largest in ...
.
Controversies in economic policy
The decline in Welsh GDP per person (relative to the UK average) over recent years has prompted policy debate. There have been suggestions – for example, by Plaid Cymru – that Wales should attempt to emulate the Irish ' Celtic Tiger' model, particularly its low corporation tax rates, to stimulate investment and growth. However, economists such as Nicholas Crafts and John Bradley have argued that the low Irish corporation tax rate was only effective in the very specific demographic
Demography () is the statistical study of populations, especially human beings.
Demographic analysis examines and measures the dimensions and dynamics of populations; it can cover whole societies or groups defined by criteria such as edu ...
and historical circumstances of Ireland in the late 1980s and 1990s, and that such a policy in Wales' very different economic context would not only require political independence
Independence is a condition of a person, nation, country, or state in which residents and population, or some portion thereof, exercise self-government, and usually sovereignty, over its territory. The opposite of independence is the statu ...
, but could be relatively ineffective and/or require difficult policy choices between higher personal taxes and lower public spending.
In a report for the Institute of Welsh Affairs in 2003, Phil Cooke of Cardiff University
, latin_name =
, image_name = Shield of the University of Cardiff.svg
, image_size = 150px
, caption = Coat of arms of Cardiff University
, motto = cy, Gwirionedd, Undod a Chytgord
, mottoeng = Truth, Unity and Concord
, established = 1 ...
argued that the Welsh Government
The Welsh Government ( cy, Llywodraeth Cymru) is the Welsh devolution, devolved government of Wales. The government consists of ministers and Minister (government), deputy ministers, and also of a Counsel General for Wales, counsel general. Minist ...
had responded to the loss of productivity
Productivity is the efficiency of production of goods or services expressed by some measure. Measurements of productivity are often expressed as a ratio of an aggregate output to a single input or an aggregate input used in a production proces ...
in manufacturing by substituting new jobs in the public sector, making Wales increasingly dependent on fiscal transfers from Whitehall
Whitehall is a road and area in the City of Westminster, Central London. The road forms the first part of the A roads in Zone 3 of the Great Britain numbering scheme, A3212 road from Trafalgar Square to Chelsea, London, Chelsea. It is the main ...
. Cooke suggested that a relatively weak devolution
Devolution is the statutory delegation of powers from the central government of a sovereign state to govern at a subnational level, such as a regional or local level. It is a form of administrative decentralization. Devolved territories h ...
settlement had prevented the Welsh Government
The Welsh Government ( cy, Llywodraeth Cymru) is the Welsh devolution, devolved government of Wales. The government consists of ministers and Minister (government), deputy ministers, and also of a Counsel General for Wales, counsel general. Minist ...
from developing innovative economic policies, especially when compared to Scotland
Scotland (, ) is a country that is part of the United Kingdom. Covering the northern third of the island of Great Britain, mainland Scotland has a border with England to the southeast and is otherwise surrounded by the Atlantic Ocean to the ...
. However, critics including former Welsh Secretary
The secretary of state for Wales ( cy, ysgrifennydd gwladol Cymru), also referred to as the Welsh secretary, is a Secretary of State (United Kingdom), secretary of state in the Government of the United Kingdom, with responsibility for the Offi ...
Ron Davies and John Lovering, another Cardiff academic, claimed that Cooke's argument that a more powerful Assembly was a necessary precondition to more effective economic policies was a '' non-sequitur''.
Labour force
According to the Welsh Government
The Welsh Government ( cy, Llywodraeth Cymru) is the Welsh devolution, devolved government of Wales. The government consists of ministers and Minister (government), deputy ministers, and also of a Counsel General for Wales, counsel general. Minist ...
bulletin of economic statistics for November 2010, the Labour Force Survey estimates for the 3 months to September 2010 show that:
* The employment rate in Wales was 67.1%, unchanged from the same period a year earlier. The UK average was 70.8%.
* The ILO
The International Labour Organization (ILO) is a United Nations agency whose mandate is to advance social and economic justice by setting international labour standards. Founded in October 1919 under the League of Nations, it is the first and ol ...
unemployment rate in Wales was 8.1% of the economically active, down from 8.8% in the same period a year earlier. The UK average was 7.7%.
* The economic activity rate in Wales was 73.3%, down from 73.7% in the same period a year earlier. The UK average was 76.8%.
* The claimant count rate in October 2010 for Wales was 5.0% of the workforce, down 0.7% in October 2009. The UK average was 4.5%.
For statistical purposes, the Office for National Statistics
The Office for National Statistics (ONS; cy, Swyddfa Ystadegau Gwladol) is the executive office of the UK Statistics Authority, a non-ministerial department which reports directly to the UK Parliament.
Overview
The ONS is responsible for th ...
divides Wales into 26 travel to work area
A travel to work area or TTWA is a statistical tool used by UK Government agencies and local authorities, especially by the Department for Work and Pensions and Jobcentres, to indicate an area where the population would generally commute to a ...
s, collections of wards
Ward may refer to:
Division or unit
* Hospital ward, a hospital division, floor, or room set aside for a particular class or group of patients, for example the psychiatric ward
* Prison ward, a division of a penal institution such as a priso ...
for which "of the resident economically active population, at least 75% actually work in the area, and also, that of everyone working in the area, at least 75% actually live in the area". Some of these areas span the border with England.
Small and medium-sized enterprises made up over 99% of the 190,000 businesses in Wales in 2006, but accounted for less than 60% of employment.
Alongside official national statistics a number of respected private sector surveys are used to understand how the economy is performing. These include the British Chambers of Commerce
British may refer to:
Peoples, culture, and language
* British people, nationals or natives of the United Kingdom, British Overseas Territories, and Crown Dependencies.
** Britishness, the British identity and common culture
* British English, ...
Quarterly Economic Survey This survey has information on the performance of Welsh businesses since 1989.
Regional economy in Wales
Earnings
Average earnings and employment vary considerably across Wales. They are both generally higher in east Wales, especially in urban areas, but lower in south west Wales and the Valleys, although earnings in Bridgend
Bridgend (; cy, Pen-y-bont ar Ogwr or just , meaning "the end of the bridge on the Ogmore") is a town in Bridgend County Borough in Wales, west of Cardiff and east of Swansea. The town is named after the Old Bridge, Bridgend, medieval bridge ...
and Neath Port Talbot, which are still centres of skilled manufacturing employment, are relatively high. In north and north west Wales, earnings are low but the employment rates are above the Welsh average.
A significant part of the earnings (and value added per job) variations within Wales are due to structural factors such as economic mass and occupational mix rather than like-for-like lower pay or productivity
Productivity is the efficiency of production of goods or services expressed by some measure. Measurements of productivity are often expressed as a ratio of an aggregate output to a single input or an aggregate input used in a production proces ...
. Cardiff, with over 400,000 people, benefits from its size, capital status, a hinterland in south east Wales and good connections to London and the M4 corridor
The M4 corridor is an area in the United Kingdom adjacent to the M4 motorway, which runs from London to South Wales. It is a major high-technology hub. Important cities and towns linked by the M4 include (from east to west) London, Slough, Brackne ...
. Cardiff is the primary location for service sector activities in Wales, with 26% of Welsh service sector output and 22% of Welsh service sector employment, compared to 19% of all employment in Wales. North east Wales benefits from proximity to Cheshire
Cheshire ( ) is a ceremonial and historic county in North West England, bordered by Wales to the west, Merseyside and Greater Manchester to the north, Derbyshire to the east, and Staffordshire and Shropshire to the south. Cheshire's county t ...
, Greater Manchester and Merseyside
Merseyside ( ) is a metropolitan county, metropolitan and ceremonial counties of England, ceremonial county in North West England, with a population of List of ceremonial counties of England, 1.38 million. It encompasses both banks of the Merse ...
and there is significant cross-border commuting
Commuting is periodically recurring travel between one's place of residence and place of work or study, where the traveler, referred to as a commuter, leaves the boundary of their home community. By extension, it can sometimes be any regul ...
. The Valleys and the western areas of Wales have less economic mass and are more distant from major economic centres. These are some of the poorest regions in Europe and qualify for Objective One
The regional policy of the European Union (EU), also referred as Cohesion Policy, is a policy with the stated aim of improving the economic well-being of regions in the European Union and also to avoid regional disparities. More than one third ...
funding.
Employment
Many parts of Wales suffered from a continuous decline in heavy industry over the 20th century, culminating in the virtual disappearance of coal-mining in the 1980s. The demise of 'smokestack
A chimney is an architectural ventilation structure made of masonry, clay or metal that isolates hot toxic exhaust gases or smoke produced by a boiler, stove, furnace, incinerator, or fireplace from human living areas. Chimneys are typic ...
' industries left a legacy of high unemployment, and although unemployment has declined in recent years, unemployment in West Wales
West Wales ( cy, Gorllewin Cymru) is not clearly defined as a particular region of Wales. Some definitions of West Wales include only Pembrokeshire, Ceredigion and Carmarthenshire, which historically comprised the Welsh principality of ''Deheuba ...
and the Valleys still tends to be higher than the Welsh average and economic inactivity (a form of hidden unemployment) continues to be a major problem in these areas. Merthyr Tydfil
Merthyr Tydfil (; cy, Merthyr Tudful ) is the main town in Merthyr Tydfil County Borough, Wales, administered by Merthyr Tydfil County Borough Council. It is about north of Cardiff. Often called just Merthyr, it is said to be named after Tydf ...
and Neath Port Talbot have some of the largest proportions of people in the UK not working due to long-term illness or disability, though some believe that in reality many people classified as "unable to work" through sickness are low-skilled workers encouraged to exit the labour market by the benefits system as well as declining demand for their skills.
GDP in Welsh regions
The figures below for 2013 come from EurostatGross domestic product (GDP) at current market prices by NUTS 3 regions (nama_10r_3gdp)
Eurostat, 21 May 2015. Navigation: Database by themes, Economy & finance, National accounts (ESA 2010), Annual national accounts, Regional economic accounts, GDP indicators, GDP at current market prices by NUTS 3 regions. Codes for Welsh regions begin UKL. and are denoted in Euros.
The GDP per head for Wales was €23,200, which was 84% of the EU average of €26,600, whereas for the UK as a whole this figure was 118%. The region of Wales with the highest GDP per head was Cardiff & Vale of Glamorgan with 114% of the EU average, and the region with the lowest GDP per head was Isle of Anglesey with 57% of the EU average.
See also
*
Regional economy in Wales
Regional economy in Wales is centred on four regional economic boards in Wales. Each board oversees a city deal, city or growth deal, signed between 2016 and 2022, lasting 10–15 years. Two of the deals are city deals signed and proposed by th ...
(City regions)
*
Barnett formula
*
Countries of the United Kingdom by GDP per capita
*
Economic geography of the United Kingdom
The economic geography of the United Kingdom reflects its high position in the current economic league tables, as well as reflecting its long history as a trading nation and as an imperial power
Imperialism is the state policy, practice, or ...
*
Economy of Cardiff
*
Economy of the European Union
*
Economy of the United Kingdom
*
List of companies of Wales
*
Renewable energy in Wales
In 2019, Wales generated 27% of its electricity consumption as renewable electricity, an increase from 19% in 2014. The Welsh Government set a target of 70% by 2030. In 2019, Wales was a net exporter of electricity. It produced 27.9 TWh of electri ...
Notes
References
External links
*
Welsh GovernmentBritish Chambers of Commerce Quarterly Economic Survey
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