ECONOMY - Challenges of a changing Economy
Overview:
Change is a constant in the modern world. A huge topic. So, in order to prevent us holding up our
hands in horror and thinking this is too big to grasp, this topic will focus on the last 300 years in
Wales to give a perspective of the massive changes that have happened, and led to where we are.
By using a familiar area, students can debate the underlying resources, challenges and
opportunities and think about a Wales of the future.
Learning objectives:



Outline the history of key industries in Wales (which is a good proxy for generalised global
industrial development, certainly in the West)
Outline the changing patterns of employment and think about the political implications of
this
Investigate the unique selling points for a small nation state and critically evaluate them, in
a UK, European and global context.
LESSON
Introduction
Activity 1 can best be used here.
Ask the plenary group to raise their hand of they have one of more parent / adult at home who
works in
- farming / agriculture?
- industry (making things) ?
- building and construction?
- education (school / university)?
- health services ?
- local government / Welsh Govt. (not above) ?
- in energy / renewables industry ?
- are unemployed /under-employed (that is working less hours than they would want to)?
- in retail (shops, online, market) ?
- in hotels / food / drink industry ?
(And others, dependent on your area.)
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Activity 2 (optional, can be used later in the lesson)
Break the group into smaller groups and spend 5 -10-15 minutes (dependent on your time
available) with the students discussing what they know about their grandparents’ generation and
if there has been a change. Ask them to consider the industries / employment areas in Wales
going back further generations.
HISTORY
1)
Pre 1800
a) Economic development in Wales was said to be restricted by
i) its peripheral location,
ii) predominantly upland topography,
iii) poor communications and
iv) sparse population.
Has this changed?
b) One of the most advanced was in the small coastal ports (with the south trading largely
with Bristol and the north with Liverpool, but also Ireland and even US). The other major
source of external trading were the drovers, who drove sheep / cattle from Mid Wales
along the Drovers roads for sale / slaughter (to English Midlands and London's Smithfield
Market) from the 14th century onwards. The drovers established the first banks in Wales,
such as "Banc Y Ddafad Ddu" in Aberystwyth (1810) and then Tregaron.
c) From mid-18th century, the exploitation of rich mineral deposits began and the English
entrepreneurs and financiers arrived to fund the industrialisation. The ‘sparse population’
and ‘poor communications’ facilitated a colonialization of Wales (in much the same was as
England dominated African countries, and the sub-continent). The changes in technology
(e.g. iron smelting by coke) pushed an increased demand for metals and coal, both present
in Wales in large resource banks.
This demand and exploitation at home allowed Great Britain to become a major
international player, with shipping (transport), business and energy being key measures of
success (as they still are).
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2) 1800 +
PORTS
(a) CARDIFF
Following the development of the coal found in the Cynon and Rhondda valleys and the Merthyr
area, South Wales :
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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 tonnes to 2.219
million tonnes
(b) SWANSEA
Originally a small fishing harbour
 1800s – an 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 1881-2
 Increased trade to and from North Devon (vegetables/coal), Cornwall (tin, tungsten) and
coastal France, Spain and Portugal.
(c) ABERYSTWYTH
Originally a small fishing port but
 Mid 1700s onwards – was the key port for registration of ships (of more than 15 tons)
 1800s onwards - Aberystwyth registered ships from Pembrokeshire up to Harlech and
became one of the three major Welsh trading ports
 1800 - 1850 imported coal, limestone and foodstuffs; exported 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.
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3) SLATE
-
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 MidWales
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.
4) COAL
-
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
o 2.25m went to the steel industry,
o 1m to the domestic market and other industries
o the rest for export.
-
1855
8.8m tons were produced, with 2.6m exports
-
1875
16.5m tons were produced, 4.3 m exports
-
1913
57m tons of coal, by 232,000 men in 620 mines
-
1920
Peak employment 271,000 (post war development and redeployment)
-
1927+
Recession / depression – move to other energy (oil and gas), and overseas imports
-
1936
Employment down to 140,000 men
-
Steady decline over 20th century
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ABERYSTWYTH AS EXAMPLE (students can be encouraged to investigate other areas)
Population 1811
Population 2011
2,264
12,250
House of Commons Report (to expand the town boundaries)
“The Commerce of the Port is principally in Lead Ore, Pig Lead, Oak-bark; Corn and Butter,
Coal and Culm are imported from the North and South of Wales; Groceries, Shop-goods and
American Timber (direct); and as there is no Market Town within 18 miles, it supplies an
extensive rural District.”
TOURISM
- not just a modern day industry, and with similar problems …
House of Commons reports
EXTORTION IN ABERYSTWYTH 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 town report
“….. Aberystwyth is a fashionable sea-side resort, containing a
population of 6664, and capable of accommodating 7000 visitors”
(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.”
(OLD COLLEGE)
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.
Purchased by subscriptions from the people of Wales for a University College for
working people to study.
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5) Changing 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).
In the early 1930s, unemployment in the South Wales Valleys (coal dependent) rose to huge
proportions
e.g. to 59% in Merthyr and 76% in Pontypridd.
And this was despite 400,000 people leaving the region between 1921 and 1939 (mass valley
depopulation); those that left were probably the ‘brightest and best’ : a ‘brain drain’ as we
would now say.
The steel and tinplate industries were concentrated in a smaller number of larger sites (Port
Talbot, Llanwern) – and of necessity began employing less people.
Number of coal pits in South Wales shrank
1953 115 pits
1981 34 pits
producing almost 21 million tons
producing 7.7 million tons.
Pembrokeshire and Swansea Bay – saw the start of the petrochemical industry, with new light
industry attracted to locations throughout Wales (with favourable Local Rates / taxation
advantages). But these were either small scale or largely foreign 'branch factory' operations (with
low-wages, low-skills). Or both.
6) Recent
The early 1980s - another recession with the same patterns:
- a 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.
2008 and the collapse of banks, a new recession
These same patterns were repeated again
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e.g. 2012 - 2013
Employment rate (aged 16-64)
Wales
2013 69.3%
2012 68.7%
UK
71.6%
71.2%
Claimant count (of
economically active)
2013 4.9%
2012 5.4%
4.2%
4.7%
Economic inactivity (aged 16-64)
2013 24.7%
2012 24.9%
22.3%
22.5%
Recent business / employment patterns
The Welsh Governments estimates employment in businesses in 2012 as
(as opposed to self-employed, sole traders, etc).
1,017,500
By business size:
Micro (0-9)
Small (10-49)
Medium (50-249)
Large (250+)
33.3%
14.6%
12.5%
39.5%
(largest growth area 2003-12)
Business size shows huge variation by sector
e.g.
In Agriculture
92% of all business are “Micro”
In manufacturing production 52% of business are classified as “Large”
Of all Welsh business, approximately 1/3 are owned by non-UK companies (and these are mostly
in the Large category – indeed MOST of the Large category).
ACTIVITY 3
Small Group activities – discuss and make notes on:
(1) Reconsider the first section, on the economic limitations in Wales. Has this changed
over the last 300 years?
(i) its peripheral location,
(ii) predominantly upland topography,
(iii) poor communications and
(iv) sparse population.
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Perhaps think about how the definitions have changed e.g. ‘peripheral’ in 1800 probably
meant from London / the industrial north of England; now, this might be peripheral in
terms of “the Chinese powerhouse”, or the BRIC nations. What about the other three
limitations?
(2) Do the statistics above (size of business, ownership of business) make Wales
vulnerable? Or is this a sign of flexibility?
7) Future
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 and capital
investment (and not usually from within Wales). This has meant that in the recessions of 2008,
1970s, 1930s, and before, the changes in industry and employment have not been under the
control of the Welsh. The flight of capital and population has left deep seated problems.
IF we need High Tech, innovative, nimble and flexible businesses and enterprise to make Wales a
success, consider how YOU (the future) would do this.
ACTIVTY 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?
This can be a short activity based on discussions, but could be developed into research and
presentations to form a serious preparation for the Assessment element of the Global Citizenship
Challenge.
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REFERENCES
Welsh Government (2014) ‘Workplace employment by industry’ [online] Available at:
http://gov.wales/statistics-and-research/work-place-employment-industry/?lang=en
BBC (2012) ‘Drovers in Wales’ [online] Available at: http://www.bbc.co.uk/blogs/
wales/entries/d0214007-fead-3c68-b8cb-f4ac7b78ad3d
Office for National Statistics (2013) ‘2011 Census Analysis, 170 Years of Industry’
[online] Available at: http://www.ons.gov.uk/ons/rel/census/2011-census-analysis/170-yearsofindustry/index.html
Welsh Government (2014) ‘The Welsh Workforce – Employment in Wales’ [online]
Available at: http://www.assembly.wales/research%20documents/rn14-020%20the%20
welsh%20workforce%20%E2%80%93%20employment%20in%20wales/rn14-020.pdf
Museum Collections (2013) ‘Aberystwyth and Tregaron Bank’ [online] Available at:
http://pilgrim.ceredigion.gov.uk/index.cfm?articleid=3358
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