Growth in Wales increased by 0.3% to 1.1% in the year to March 2019 according to estimates from ESCoE. At 2.7% and 0.7% London and Northern Ireland had the highest and lowest growth rates in the country. The East of England was the most improved region of the UK with growth accelerating from 0.9% to 1.9%. The UK growth rate for the same period was 1.5%.
Unemployment in Wales increased 5,000 to 71,000 between January and March; the increase of 0.4% to 4.5% was the highest in the UK. At 2.4% and 5.4% the SW of England and the North East had the lowest and highest unemployment rates in the country. The UK unemployment rate stands at 3.8%.
In March, average earnings in Wales decreased to £553 per week. London had the highest average earnings of £762 whereas the Northern Ireland had the lowest of £513. In the UK average earnings grew by 3.3% or by 1.5% after inflation.
Welsh average property prices, at £123,046, remained flat during the month which meant annually prices grew by 3.0%. In comparison, UK prices dropped by 0.2% to £226,798 during March which cut the annual growth rate to 1.4% although transactions were up by 1.4%.
In its estimate of regional public spending and regional tax revenues in 2018, the ONS has concluded that Wales had a deficit of £13.7bn. This compares with London which had the highest surplus of £34.3bn. On a per person basis the Welsh deficit was £4,395, the highest in Great Britain. London had the highest surplus of £3,905 per person and Northern Ireland had the biggest deficit in the UK at £4,939. The only areas of the UK to run surpluses were London, the South East and the East of England. At a national level, the UK had a deficit of £636 per person which split into deficits of £106, £2,452, £4,395 and £4,939 for England, Scotland, Wales and Northern Ireland.
City Deals are one of the UK Government’s key regional policy tools aimed at giving local areas powers and funding aimed at supporting economic growth, creating jobs and investing in local projects. Some deals have worked well, but where deals involve multiple different local authorities and public agencies they can unravel. The £1.3bn Swansea Bay City Deal, signed in 2017, aimed at stimulating economic growth in a region stretching from Pembrokeshire to Port Talbot, involves four councils, two health boards, two universities and both the UK and Welsh governments. With private sector investment, c£1.8bn could be deployed across 11 different projects creating 9,000 jobs, but disagreements amongst the partners, especially over a £225m wellness village in Llanelli, has meant the £241m contribution from the UK and Welsh Governments has not been released. One of the partners, Neath Port Talbot Council, has threatened to pull out of the deal, citing the cost of bureaucracy and issues of confidence in governance.
A Welsh assembly inquiry has called for taxpayers’ money given to the Welsh film and TV industry to be more targeted at Welsh crews. The industry generates £187m in economic value and supports 58,000 jobs. Since 2010, £105m has been invested supporting 2,900 jobs. The Welsh Government has a £30m budget which can provide commercial funding for TV and film productions if at least 50% of the production is shot in Wales. The Wales Screen Fund also enables the Welsh Government to provide funding – since 2015, 21 productions have been awarded c£9.5m which has levered in £75m of spend on Welsh Goods and services. In comparison, Northern Ireland Screen’s c£16m investment in production funding for Game of Thrones has brought £251m to the Province’s economy since production began in 2010. The Committee also looked at the Welsh Government’s lack of transparency in its relationship with Pinewood Studios, concluding that investing public money in a studio site which was described as unsuitable for large film productions was disappointing. The Welsh Government is yet to respond.
Tata has committed to keeping the Port Talbot steel plant open, after its planned joint venture with German rival Thyssenkrupp was likely to be blocked by the EU because of competition concerns over creating what would be Europe’s second biggest steelmaker. The plant employs about 4,000 staff directly with another c15,000 in the Port Talbot supply chain. The unfortunate demise of British Steel in Scunthorpe is likely to add to the plant’s medium term viability.
In Merthyr Tydfil, Hoover Candy’s parent company, Haier Electronics, is looking to centralise some of its head office functions in Warrington by the spring of 2020 – 45 jobs are at risk. A distribution centre at the south Wales site – which employs about 60 staff – will benefit from a £2m upgrade.
A £100m project to allow trains to be tested on special tracks laid out on 4.5 mile and 2 mile ovals, at speeds of up to 100mph, has moved forward with the Welsh Government entering into a Joint Venture Agreement with Neath Port Talbot and Powys Councils. The Nant Helen opencast mine near Ystradgynlais is the preferred site for the proposed Global Centre of Rail Excellence. Currently manufacturers have to send trains across Europe for testing before they come back to the UK for service.
On transport, regional airline, Flybe, has announced it will cut six routes, mainly to Italy and Germany, from Cardiff Airport under its winter schedule plan. Extra flights on existing routes including Edinburgh, Belfast City, Cork and Paris have been added. Flybe announced it would be ending its jet operations from Cardiff this year, but would continue to offer turbo-prop flights. Cardiff Airport was bought by the Welsh government in 2013 for £52m.