information:filtering
Economy

Over the last 250 years, Wales has been transformed from a predominantly agricultural country to an industrial, and then to a post-industrial economy. In the 1950s, Wales's GDP was twice as big as Ireland's; by the 2020s, Ireland's economy was four times that of Wales. Since the Second World War, the service sector has come to account for the majority of jobs, a feature typifying most advanced economies. in 2018, according to OECD and Eurostat data, gross domestic product (GDP) in Wales was £75 billion, an increase of 3.3 per cent from 2017. GDP per head in Wales in 2018 was £23,866, an increase of 2.9 per cent on 2017. This compares to Italy's GDP/capita of £25,000, Spain £22,000, Slovenia £20,000 and New Zealand £30,000. In the three months to December 2017, 72.7 per cent of working-age adults were employed, compared to 75.2 per cent across the UK as a whole. For the 2018–19 fiscal year, the Welsh fiscal deficit accounts for 19.4 per cent of Wales's estimated GDP.

In 2019, Wales was a net exporter of electricity. It produced 27.9 TWh of electricity while only consuming 14.7 TWh. In 2021, the Welsh government said that more than half the country's energy needs were being met by renewable sources, 2 per cent of which was from 363 hydropower projects.

By UK law, Wales contributes to items that do not directly benefit Wales e.g. over £5 billion for HS2 "which will damage the Welsh economy by £200m pa", according to the UK and Welsh Government's transport adviser Mark Barry. Wales also pays more in military costs than most similar-sized countries e.g. Wales pays twice the amount Ireland spends on the military. The UK government spends £1.75bn per year on the military in Wales, which is almost as much as Wales spends on education every year (£1.8 billion in 2018/19) and five times as much as the total amount spent on the police in Wales (£365 million).

From the middle of the 19th century until the post-war era, the mining and export of coal was the dominant industry. At its peak of production in 1913, nearly 233,000 men and women were employed in the South Wales coalfield, mining 56 million tons of coal. Cardiff was once the largest coal-exporting port in the world and, for a few years before the First World War, handled a greater tonnage of cargo than either London or Liverpool. In the 1920s, over 40 per cent of the male Welsh population worked in heavy industry. According to Phil Williams, the Great Depression "devastated Wales", north and south, because of its "overwhelming dependence on coal and steel". From the mid-1970s, the Welsh economy faced massive restructuring with large numbers of jobs in heavy industry disappearing and being replaced eventually by new ones in light industry and in services. In the late 1970s and early 1980s, Wales was successful in attracting an above average share of foreign direct investment in the UK. Much of the new industry was essentially of a "branch (or "screwdriver") factory" type where a manufacturing plant or call centre is in Wales but the most highly-paid jobs in the company are elsewhere.

Poor-quality soil in much of Wales is unsuitable for crop-growing, so livestock farming has been the focus of farming. About 78 per cent of the land surface is used for agriculture. The Welsh landscape, with its three national parks and Blue Flag beaches, attracts large numbers of tourists, who bolster the economy of rural areas. Wales, like Northern Ireland, has relatively few high value-added employment in sectors such as finance and research and development, attributable in part to a comparative lack of "economic mass" (i.e. population) – Wales lacks a large metropolitan centre. The lack of high value-added employment is reflected in lower economic output per head relative to other regions of the UK: in 2002 it stood at 90 per cent of the EU25 average and around 80 per cent of the UK average. In June 2008, Wales made history by becoming the first nation to be awarded Fairtrade status.

The pound sterling is the currency used in Wales. Numerous Welsh banks issued their own banknotes in the 19th century: the last bank to do so closed in 1908. Since then the Bank of England has had a monopoly on the issue of banknotes in Wales. The Commercial Bank of Wales, established in Cardiff by Sir Julian Hodge in 1971, was taken over by the Bank of Scotland in 1988 and absorbed into its parent company in 2002. The Royal Mint, which issues the coinage circulating through the whole of the UK, has been based at a single site in Llantrisant since 1980. Since decimalisation, in 1971, at least one of the coins in circulation emphasises Wales such as the 1995 and 2000 one pound coin (above). As at 2012, the last designs devoted to Wales saw production in 2008.

During 2020, and well into 2021, the restrictions and lockdowns necessitated by the COVID-19 pandemic affected all sectors of the economy and "tourism and hospitality suffered notable losses from the pandemic" across the UK. As of 6 April 2021, visitors from "red list" countries were still not allowed to enter unless they were UK residents. Restrictions will "likely be in place until the summer", one report predicted, with June being the most likely time for tourism from other countries to begin a rebound. On 12 April 2021, many tourist facilities were still closed in Wales but non-essential travel between Wales and England was finally permitted. Wales also allowed non-essential retail stores to open.