Sunday, August 13, 2006

21st Century Wales: Crap Wages and a Stifling Economy

Denbighshire has the worst wages in Wales according to research by GMB, averaging a mere £20,860 - 74% of the UK average. Apart from Flintshire with an average of over £25,000, the picture is bleak right across North Wales. And although the situation is better in South Wales, not one county in Wales meets the UK average.

But the bad news doesn‘t stop there. A damning report by a political think tank, Reform, claims Wales is in danger of becoming one of Whitehall’s “last colonies”, dependent on state employment and taxpayers cash.

Apparently, public spending accounts for 54% of the Welsh economy. Furthermore, the state employs nearly a quarter of all workers in Wales and the average household derives 18% of its total income from social security benefits.

Cycle of Economic Inactivity - More of the same anyone?

These problems are perpetuating yet more of the same problems. As young people are forced to move out of the area in search of work, Wales loses its most economically active members. This produces a declining population. Businesses also move or are forced to close (especially small businesses). Fewer business start-ups are created and existing businesses are less inclined to invest into the area. All of this means less employment and more people on benefits. And so it goes on.

Another major concern is the reliance on tourism, creating poorly paid jobs for only several months of the year. We live in one of the wettest parts of the country and yet we rely on a tourist industry which demands nice weather? Whoever thought that was a good business idea seriously needs their head testing.

It seems that a lot of money is going into North Wales but relatively little is coming out and we’re in danger of becoming a land of retirement homes, marinas, hotels, and caravan sites. If North Wales’ economy was an animal, it’d be a one trick pony.

Can this economic tide - or rather, drought - be reversed?

I’m no business expert but my guess is that a solution probably lies in the creation of small-to-mid sized companies - preferably the latter - which are economically profitable throughout the year. That’s easier said than done but there seems to be many ’outsiders’ who are earning a decent living by running businesses which offer interesting services and niche products.

Budding business people should consider this letter by G Hughes, recently published in the Daily Post. It concerns the controversial Pwllheli marina expansion proposals but the issues and solutions raised apply throughout North Wales.

Think Outside the Box over Marina

The future of Pwllheli, or indeed of Pen Llŷn and Eifionydd, DOES NOT depend on developing the marinas as we are constantly led to be believed by the Marine Trade Association, and even some of our elected and unelected politicians.

With a combination of knowledge, imagination and entrepreneurship, the Pwllheli harbour area can be developed into other more sustainable activities.

What about a Centre of Excellence for the ever-expanding range of sea sports that are rising in popularity across Wales, such as kayaking, wakeboarding, rowing and diving? A well-equipped facility could act as an incubator for exciting new industries, just like what happened in Llandysul when it became a centre for canoeing, and at the same time provide an affordable, safe and exciting facility for local people.

What about an all weather cultural tourist attraction based on Y Mabinogion or/and Cantre’r Gwaelod, or even investing in kick-starting high-tech aquaculture, producing valuable seafood?

All these activities could be developed by a local trust, similar to Cwmni Tref Caernarfon, run 100% by local people and wholly for the benefit of local people.

Thinking outside the box is not difficult once you take off the marina blinkers.

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