1 The Challenges of a Changing Economy (Using Wales as an Example)
2 Economy: Changing EconomyINTRODUCTION Changing industries Changing patterns of employment UK, European & Global changes
3 Economy: Changing EconomyACTIVITY 1 Current employment patterns And those in recent history
4 WHAT DO YOU KNOW ABOUT YOUR GRANDPARENTS’ GENERATION?Economy: Changing Economy ACTIVITY 2 WHAT DO YOU KNOW ABOUT YOUR GRANDPARENTS’ GENERATION? HAS THERE BEEN A CHANGE? CONSIDER INDUSTRIES/EMPLOYMENT AREAS IN WALES GOING BACK FURTHER GENERATIONS
5 Economy: Changing EconomyPRE 1800 Economic development in Wales was restricted by its peripheral location, predominantly upland topography, poor communications and sparse population. Has this changed?
6 Economy: Changing EconomyPRE 1800 Major external trading: Advanced small coastal ports (trading largely with Bristol or Liverpool). The drovers (particularly in Mid Wales) Rudimentary mining
7 Economy: Changing EconomyPRE 1800 Drovers established the first banks in Wales, such as "Banc Y Ddafad Ddu" in Aberystwyth (1810) and then Tregaron
8 Economy: Changing Economy18th CENTURY AND ON Mid 18th century – exploitation of rich mineral deposits English entrepreneurs and financiers arrive Changes in technology e.g. iron smelting by coke Increased demand for metals and coal Why?
9 Economy: Changing EconomyPORTS CARDIFF Following the development of the coal found in the Cynon and Rhondda valleys and the Merthyr area, South Wales : needed a sea connection to the Bristol Channel 1794, the Glamorganshire Canal was completed, linking Cardiff with Merthyr 1798 a basin was built, connecting the canal to the sea by the 1830s, Cardiff became the biggest iron-exporting port, shipping almost half of British overseas iron exports between 1840 and 1870, the volume of coal exports increased from 44,350 to million tonnes
10 Economy: Changing EconomyCARDIFF c c 1990
11 Economy: Changing EconomyCARDIFF 2012
12 Economy: Changing EconomyPORTS SWANSEA Fishing harbour 1800s increased industrial output (copper, zinc, iron and tinplate) Developments of big steamships (replacing smaller sailing vessels) Swansea Harbour Trust (SHT) commissioned the construction of the Prince of Wales Dock in Trade to North Devon, Cornwall and France / Spain
13 Economy: Changing EconomySWANSEA c c 1970
14 Economy: Changing EconomyPORTS ABERYSTWYTH Fishing port Mid 1700s - registration of ships (more than 15 tons) Aberystwyth registered ships from N. Pembrokeshire up to Harlech Aberystwyth became a major trading port imports such as coal, limestone and foodstuffs exports including lead ore, slates and fish The port of Aberystwyth gradually declined over the second half of the 19th century and ceased exporting material in the early 20th century, pre WWI
15 Economy: Changing EconomyABERYSTWYTH AS AN EXAMPLE Seeing the rise and subsequent fall of industries, tourism was developed early on (not just a modern day phenomenon) Population ,264 Population ,250 The town built bespoke tourist facilities (Old College – hotel; Ball Room; pier & prom etc)
16 Economy: Changing EconomyTOURISM Ball Room for visitors Laura Place
17 Economy: Changing EconomyTOURISM EXTORTION IN LODGING-HOUSES “ …. that some individuals have injured the growing prosperity and reputation of the town by this most hateful and ruinous system.” (c 1840) 1881 “….. Aberystwyth is a fashionable sea-side resort, containing a population of 6664, and capable of accommodating 7000 visitors”
18 Economy: Changing EconomyTOURISM (REPORT upon the Proposed Municipal Boundary of the Borough of Aberystwyth, House of Commons papers 1837, Volume 26) “…. within the last few years it has grown into considerable reputation as a Watering Place, and is the resort of numerous families and occasional visitors, during the season, from all parts of England. It is calculated that in the months of August, September and October upwards of 1,500 persons come to reside in the Town, and that the casual visitors during that period amount to several thousands.”
19 Economy: Changing EconomyTOURISM The Castle Hotel - opened April 1865 (Gothic Revival architect John Pollard Seddon) 1860s - rapid expansion of Aber in anticipation of the arrival of the railway The Castle Hotel was built in just one year to provide superior accommodation for “people in the higher ranks” Shortly before its completion, the developer behind the project went bankrupt
20 Economy: Changing EconomySLATE Smaller industry than coal, BUT the world's largest supplier in the 19th century 1890s - there were dozens of quarries, ca. 15,000 men - largely in North and Mid-Wales Despite explosive growth in the early 1900s this stopped during WWI By the 1920s, it was apparent that Wales was facing economic difficulties, and the slate industry collapsed.
21 Economy: Changing EconomyCOAL Late 1700s - the beginnings of a canal and rail network transports coal easily New technology – steam engines (pumping and winding) & rail The cities of south Wales expanded - large docks / ports particularly Cardiff, Swansea and Newport 1840 the canal and rail network enabled 4.5 m tons of coal to be produced 2.25m went to the steel industry, 1m to the domestic market and other industries The rest for export
22 Economy: Changing EconomyCOAL m tons were produced, with 2.6m exports m tons were produced, 4.3 m exports m tons of coal, by 232,000 men in 620 mines Peak employment 271,000 in 1920 (post war development and redeployment) Recession / depression – move to alternative energy (oil and gas), and overseas imports down to 140,000 men Steady decline over 20th century
23 Economy: Changing EconomyCHANGING TIMES During the ‘boom’ period (start of the 20th century), Wales STILL HAD a narrow economic base dependent on the labour intensive exploitation of natural resources (coal, slate, some steel) Early 1930s, unemployment in the South Wales Valleys rose e.g. to 59% in Merthyr and 76% in Pontypridd. Despite 400,000 people leaving the region between 1921 and 1939. - probably the ‘brightest and best’.
24 Economy: Changing EconomyCHANGING TIMES Steel and tinplate industries - smaller number of larger sites (Port Talbot, Llanwern) – employing less people. Number of coal pits in South Wales shrank from 115 in 1953, producing almost 21 million tons, to 34 in 1981, producing 7.7 million tons. Pembrokeshire and Swansea Bay - start of the petrochemical industry (now collapsing) New light industry was attracted to locations throughout Wales – but small scale & largely foreign 'branch factory' operations (low-wage, low-skill).
25 Economy: Changing EconomyRECENT The early 1980s - another recession bigger impact in Wales than in other parts of the UK between 1979 and 1982, Wales lost 130,000 jobs and the employment rate fell to 62% recovery started later in Wales, recovered much more slowly structural changes left a legacy of high unemployment amongst older men, especially in the Valleys.
26 Economy: Changing EconomyVERY RECENT ( ) Employment rate (aged 16-64) Wales UK 69.3% % 68.7% % Claimant count (of % % economically active) % % Economic inactivity (aged 16-64) 24.7% % 24.9% %
27 Economy: Changing EconomyCURRENT ( ) WG estimate employment in businesses ,017,500 Employment in Wales Micro (0-9) 33.3% (largest growth area ) Small (10-49) 14.6% Medium (50-249) 12.5% Large (250+) 39.5% Sector variation (e.g. Agriculture 92% Micro, production 52% Large) Approx 1/3 owned by non-UK (mostly in the Large category) Do these make Wales vulnerable – or flexible?
28 Economy: Changing EconomyACTIVITY 3 Reconsider the first section, on the economic limitations in Wales. Has this changed over the last 300 years? its peripheral location, predominantly upland topography, poor communications and sparse population. Do the statistics above (size of business, ownership of business) make Wales vulnerable? Or is this a sign of flexibility?
29 Economy: Changing EconomyTHEMES Economic development in Wales ? Has this changed? its peripheral location, predominantly upland topography, poor communications and sparse population.
30 Economy: Changing EconomyFUTURE In the past Wales has found solutions to other challenging times. These have improved our wealth and health. But these changes have been dependent on innovation research capital And not always from within Wales
31 Economy: Changing EconomyFUTURE IF we need High Tech, innovative businesses & enterprise, nimble, flexible : What do they need to establish & thrive? How can you ‘sell’ Wales? What is distinctive about Wales?
32 Economy: Changing EconomyACTIVITY 4 IF we need High Tech, innovative, nimble and flexible businesses and enterprise to make Wales a success, consider how you would do this. What sort of industries? What do they need to establish & thrive? How can you ‘sell’ Wales? What is distinctive about Wales? Its USPs?