The first ever gross domestic product (GDP) figures for the regions of the UK, have been released by the Office for National Statistics. The figures highlight resilience within the Welsh economy, which grew by 2.3% in 2018 making Wales the fastest growing UK nation in 2018.
Estimates of quarterly GDP in Wales highlights that gross domestic product growth in Wales was 0.3% in Quarter 4 (Oct to Dec) 2018.
This follows positive growth of 1.3% in Quarter 3 (July to Sept) 2018.
Education grew by 3.3% and had the highest contribution to growth in Quarter 4 (Oct to Dec) 2018, at 0.23 percentage points.
This was followed by construction, which grew by 3.3%, and transport and storage, which grew by 5.0%.
Manufacturing output fell by 0.6%, public administration and defence fell by 1.2% and human health and social work industries fell by 0.9%.
Of the main industrial sectors, the construction sector was the main driver of GDP within Wales in Quarter 4 2018.
The main data for these estimates are collated by the office of national statistics and are based on turnover data from approximately 1.9 million Value Added Tax (VAT) returns. Information from the Inter-Departmental Business Register (IDBR) on workplace employment allows ONS to apportion the VAT turnover for each business based on their employment share within a region.
A detailed analysis of these new data is planned for the Economic review to be published in October 2019.
Commenting on the latest GDP statistics
Minister for the Economy and Transport, Ken Skates said:
The results are a testament to the Welsh Government supporting businesses throughout Wales, and supporting the economy in what are incredibly difficult times.
We are making strategic investments in terms of infrastructure and supporting those industries of tomorrow which will provide sustainable employment.
Secretary of State for Wales Alun Cairns said:
“Growing by 2.3% in 2018, Wales had the fasted growing economy of any UK nation. These very strong figures are testament to the hard-working people in our communities who continue to capitalise on the opportunities created for economic growth.
“The UK Government will continue to invest in innovation and secure new trade deals, creating jobs and putting more money back in people’s pockets. By doing this we will ensure that our economy continues to grow at this rapid rate, putting regions across Wales on the map as leading destinations for inward investment.”
Heather Myers, Chief Executive, South and Mid Wales Chambers of Commerce commented:
“This is good news for Wales, and shows the resilience of businesses trading through this prolonged period of uncertainty. However, we must not be complacent, and understanding what lies behind the statistics is vital. In such a rapidly changing business environment, where the planning for Brexit by some companies may have skewed the figures through stock piling, we need to be careful of the assumption that growth in 2018 is sustainable, especially when trading conditions remain volatile and unpredictable for many Welsh businesses.
We are certain that Welsh business need support in finding practical solutions to the barriers they face, and the South Wales Chamber is here to ensure that we work to support the practical issues faced by businesses every day to support ongoing trade and growth for Welsh SME’s. We continue to campaign for the best solution to the current challenges in an effort to drive sustainable growth in the Welsh economy as a whole.”
Ben Cottam, Head of External Affairs, FSB Wales commented:
‘These figures make really pleasing reading and show that Wales has dynamic and innovative smaller businesses driving economic success and growth. We can’t afford to take our foot off the pedal and need to continue to focus on growing and developing indigenous smaller businesses across Wales and understanding their needs, particularly in areas such as infrastructure.
However, uncertainty over Brexit hangs like a cloud over so many businesses and unless politicians can come together in the coming weeks to secure a deal which allows for managed transition, access to qualified labour and continued, easy trade with the EU, we could risk this growth in the coming months and years. These figures demonstrate the importance of EU markets to the Welsh economy and particularly to those SMEs engaged in export.
While politicians across the board will rightfully celebrate this growth therefore, their sole mission is to ensure that the create the environment for it to continue’