Innovation and Technical Change in Wales

The comparative technological/economic gap between Wales and other parts of the UK remains a common statistical fact in national statistics as much as well as a worry for Welsh planners.  As a result, a series of policies and programs have been put in place in an attempt to close this gap.  However, a better understanding of the nature and dynamics of business growth, innovation, and competitiveness of the Welsh economy is imperative in order to gear these policies/ programs towards the right targets.

The manufacturing sector remains one of the crucial drivers of the Welsh economy and therefore, continues to attract a lot of attention from academia and policy makers alike.  In continuation with this, a part of the quantitative research is targeted towards analysing and understanding the nature and dynamics of business growth, innovation, and competitiveness of the Welsh manufacturing sector.

One aspect of the research studies the automotive sector, given its strategic significance for the manufacturing sector and for local economies.  The objective is to take stock of the ongoing structural and organisational revolution within the industry in Wales (vis-à-vis the UK) and to analyse the strengths and weaknesses of the industry from a systemic innovation point of view.

Having been a cradle of the industrial revolution in the UK, Wales continues to be a major part of the UK’s manufacturing landscape in general and the automotive industry in particular.  The automotive sector in Wales, which is the mainstay of its manufacturing base, is what has remained (or rather was resurrected) during the lengthy period of restructuring that Wales has experienced. Supportive government policy during the post-war years gave a boost to engineering and other manufacturing firms that has given rise to a notable automotive cluster equating to one of the most important sectors in the Welsh economy in recent years.  Be it in terms of innovation or encouraging foreign investment, this sector has long since been in the forefront.

Indeed, the growth of Wales’ automotive industry is a story of rapid transition from a comparatively laggard growth with a long period of rehabilitation and restructuring to the recent flourishing of manufacturing accomplishment with high levels of foreign direct investment.  In particular, Wales has been the second most successful UK region in securing automotive foreign direct investment.  The automotive sector is now a well established and diverse supply chain cluster that offers the complete range of technological support, covering the total product life-cycle from concept, design and testing, through to manufacture.

The battle for markets and customers in the sector has also had its impact on the Wales’ industrial structure.  Additionally, the current economic downturn has of course had a very significant impact on the automotive industry globally, affecting the sector in Wales and the rest of the UK.  Notwithstanding the fact that there will always be a demand for personal and road freight transport and therefore always a need for an automotive industry, these pose serious challenges to the industrial structure, its competitiveness and innovative performance.  In light of these, our research takes stock of the survivability and innovation potential of the industry and examines the (remaking of) the innovation processes and boundaries of the automotive sector in Wales.

The researchers involved in this project are Mamata Parhi and Catherine Robinson.

Related WISERD Publications

Riley R, Robinson C, 2010, ‘Which Firms Innovate in British Manufacturing and Service Sectors?’ SERVICEGAP Discussion Paper 2 (Available here)

Parhi M, 2011, ‘Innovation in the Welsh Automotive Industry: Challenges and Strategies’ WISERD/WPS 003 (Available here)

For further information, contact Mamata Parhi:  m.parhi@swansea.ac.uk