Next May’s Senedd election offers a real opportunity for Wales to decide what kind of economy we want to be – and to come together around our strengths to make it happen.

Wales is a small nation with a strong identity, built on entrepreneurs, SMEs and family businesses. That’s something to be proud of. We’re nimble, adaptable and resourceful. But we need to get better at backing those strengths, creating the right environment for enterprise and celebrating success when it happens.

It’s not an easy time to run a business. Every year seems to bring a new set of pressures – from Covid recovery to inflation, tariffs and energy costs, now compounded by further regulation and uncertainty over budgets in both Cardiff and Westminster. Many business owners I speak to are simply focusing on keeping going, paying the wages this month and then doing it again next month.

We know that certainty isn’t going to come any time soon. But that means we need a realistic and practical partnership between business and government – one that makes it easier to invest, employ and grow.

There’s no shortage of business support in Wales, but access to it can be confusing. What we need from the next Welsh Government is a more holistic, long-term approach. Economic growth takes time. Businesses don’t work to election cycles, and neither should economic policy. If Senedd terms are to become shorter, with Senedd elections now taking place every four years, we’ll need to see longer-term thinking to take account of any unintended consequences of that.

Coalition government looks likely, and with that comes the question of whether parties can work together for the long-term good of the Welsh economy. We’ve already seen some cross-party cooperation around Welsh Government budget discussions this year, and that kind of grown-up politics will be essential in future.

It’s also time to be honest about the scale of the challenges. Costs are rising, regulation is tightening and confidence is under pressure. The Employment Rights Bill, for example, is causing real anxiety among SME owners who are already grappling with high National Insurance contributions and complex recruitment issues. For many, the fear is not about treating staff fairly – which most already do – but about the increasing administrative and financial burden of compliance.

The same applies to energy performance targets. The principle is sound, but the current expectation that all commercial buildings reach EPC category C by 2029 simply isn’t realistic. Many property owners are already selling off property because of the cost of compliance. SMEs are facing the same issue, and it risks diverting investment away from growth and innovation. We need an open conversation between government and business about what’s achievable, affordable and sustainable.

Despite these pressures, Wales has every reason to be positive. We have talented people, a growing base of entrepreneurs and a strong network of SMEs. If government can focus its support and remove unnecessary hurdles, the business community can do the rest.

We should back our winners – the sectors and entrepreneurs with the potential to create growth and jobs – and trust them to deliver. Business doesn’t need endless grants or new schemes; it needs facilitation, collaboration and a frictionless environment to operate in.

Investment is fundamental to that. Businesses want to reinvest in their people, in new technology and in the future of their communities. That’s not about wealth for its own sake; it’s about creating opportunity and resilience.

We also need to invest in skills. Through my work with The King’s Trust in Wales, I’ve seen how much potential there is among young people — but also how many are still falling through the cracks. Last year we supported around 4,500 young people into training, employment or enterprise. The need is ten times that.

We must do a better job of connecting our education system with the needs of business. If we want to grow high-value manufacturing, we should be preparing young people for those jobs early on. The new curriculum offers a chance to do that by showing students what opportunities exist here in Wales and by promoting entrepreneurship as something to aspire to.

Leadership and management skills are another area where targeted support could make a big difference. Many small businesses never scale up because the skills that get them to one level aren’t the same as those needed to grow further. Better provision in this area would directly boost productivity and job creation.

The next Welsh Government will face tough choices. But if it focuses on building from our strengths – our SMEs, our entrepreneurs, our talent and our willingness to collaborate – then Wales has everything it needs to succeed. The business community stands ready to play its part.

Richard Selby talks about this and more in the Business in Focus From Startup to Scaleup podcast. Listen here.