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Mike Powell on the economy and jobs

April 26, 2015 2:00 PM

In coalition government we have cleared up the mess Labour left behind and put the economy back on the road to recovery. It is not there yet, there is still more to do, but given the economic incompetence showed by labour last time then it would be a disastrous move to return them to power.

The Labour party can't be trusted on the economy. They borrowed and borrowed and nearly bankrupted Britain. Now they have no answers on how to fix the mess they created.

We have delivered a tax cut of over £800 for millions of working people and want to increase that by raising the income tax threshold still further.

Whilst unemployment has steadily fallen across the UK in the past couple of years in Wales the recovery has not been as evident as elsewhere.

We have a problem with infrastructure which results in a centralisation of industries and jobs along the M4 corridor and in North East Wales.

For many years, the economic strategy for Wales was driven by attracting inward investors by the promise of being a low-wage place to enter the EU market. While this was successful in the short-term, it was never likely to be a positive long-term strategy for Wales.

Firstly, it entrenched low wages as part of the sales pitch we were offering to the world. Secondly, the very nature of the jobs brought was that they were relatively portable, meaning they could be moved out again as easily as they were moved in once lower-cost locations joined the EU.

Thirdly, it lacked long-term ambition in that it failed to recognise the tendency for wages to rise as an economy develops, and put no plan in place to change the strategy as Wales' economy grew. In short, it either assumed that Wales' economy would not develop as a result of thin strategy, or made that inevitable because of a lack of preparation for the next stage. Developed economies compete on innovation and quality, not price

We are never going to get back to the "good old days" of the industrial valleys. What we need to be encouraging now are more small and medium sized enterprises and industries based on different skill sets.

The South and Mid Wales Chambers of Commerce in their January report said

"There is a welcome move towards businesses recruiting more full-time and permanent staff which is good news for the economy on two levels. Firstly, it demonstrates that businesses feel confident that they can take on the responsibility of employing people in the long-term, but it also means that consumers have more money in their pockets to spend due to greater job security."

They said the fact that business confidence is increasing was demonstrated by the number of organisations that have seen an increase in their sales, in both the UK and export market, during the course of 2014.

However, they expressed concern over the number of businesses reporting that they are experiencing difficulties in recruiting staff. There is a need to improve the skills of the current and future workforce and create better partnerships between the public, private and academic sectors.

This, they said, had been a trend throughout the previous year and this is now an urgent problem that needs to be addressed.

If we are to develop a sustainable Welsh economy then the skills shortage needs to be addressed, otherwise companies will look elsewhere for the skills and talent they require.

Education is key to a prosperous economy, but it must deliver a mixed curriculum that addresses the needs of the workplace. That means as much emphasis and value should be placed on vocational training as academic studies. It also means we have to educate children in order to make them employable and not only to tick boxes and meet artificial targets.

Apprenticeships are now high on the agenda both sides of the border and there has been a marked increase in the number of places on offer. However, these need to be meaningful high quality skilled apprenticeships and not just glorified youth training schemes.