Columnist Dylan Jones-Evans has argued that Wales has created an increasingly complicated economic-development system, suggesting that sometimes the most useful interventions are remarkably straightforward.
Writing in his latest column, Jones-Evans reflects on an American article titled Most of America is a Small Town, which examined population data for nearly 20,000 incorporated places in the United States and found that the median community has just 1,153 residents. Three-quarters have populations below 5,000, and almost half have fewer than 1,000.
As someone brought up in Pwllheli in North Wales, Jones-Evans says it resonated with him, especially given how the town has been neglected in recent years. He wondered what the equivalent figure would be for Wales.
Most Welsh settlements are small
According to the Office for National Statistics, Wales has 579 built-up areas, which represent actual settlements rather than artificial administrative boundaries and together account for 88% of the Welsh population. The median Welsh built-up area has a population of only around 1,260.
Some 252 have fewer than 1,000 residents, and more than four out of five have fewer than 5,000. At the other end of the scale, only a handful of Welsh settlements have populations greater than 50,000. Cardiff, with 348,535 residents in the 2021 census, is in a completely different league from most of the country.
Jones-Evans argues that most of Wales really is a small town, and that this raises an important question about how economic development is organised.
Too much focus on large regions?
For the last two decades, there has been a steady movement towards ever larger economic geographies, including city regions, growth deals, regional economic frameworks and, more recently, corporate joint committees. There are perfectly sensible reasons for this, as transport systems, labour markets, universities and major industrial clusters do not fit neatly within council boundaries.
If Wales wants to attract major international investment or develop industries such as compound semiconductors and renewable energy, then regional and national approaches are essential. But Jones-Evans asks whether we have moved too far away from the places where economic activity actually happens.
A business does not expand in an economic region but in a town. When a manufacturer runs out of factory space, it needs another building somewhere close enough to retain its workforce, and if a company employing 50 people closes in a community of 5,000, that is a major economic shock regardless of how insignificant those jobs might appear within the larger region.
A simple proposal for town-level growth
Jones-Evans suggests that real economic development means knowing which businesses in a town are growing, which are thinking about expanding, which are struggling to recruit and which may be considering leaving. Above all, it means regularly talking to the firms already employing people.
For most small communities, the biggest economic-development victory will not be attracting a huge company from somewhere else. It will be helping an existing business employing 20 people become one employing 30 or preventing another established employer from leaving because it cannot find suitable premises.
He proposes that every significant Welsh town should have somebody whose responsibility is simply to know its economy properly. In smaller areas, several towns could share the resource. Their job would be to speak regularly to local employers, understand which businesses had growth potential, maintain a live picture of available property and land and connect companies with finance, colleges, universities and business support.
Wales has £546.5m available through the Local Growth Fund over the next three years, including more than £156m for innovation and business competitiveness. A network of 50 town business growth managers would cost around £3m a year or less than 2% of the overall Fund and could cover roughly 125 of the larger towns.
Jones-Evans concludes that Wales should be developing globally competitive industries, attracting investment and supporting businesses capable of rapid growth, but that does not mean ignoring the economic geography of the country we actually have. Most of Wales is a small town, and it might be time we started developing our economy from the town upwards rather than always from the region downwards.
