ENTREPRENEURS AND THE WELSH LANGUAGE

While only one-fifth of the population of Wales are Welsh speakers, previous studies have indicated that they may have different economic characteristics from other language groups.

For example, research by various economists has shown that Welsh speakers have been found to have a lower unemployment rate, are less likely to be economically inactive and, most importantly, have an earnings advantage in Wales.

However, what about the impact of the Welsh language on entrepreneurial activity?

During the past 20 years, Wales has seen a proliferation in Welsh language businesses. For example, there are an increasing number of Welsh language bookshops independently owned by Welsh entrepreneurs.

In addition, the growing demand for Welsh literature has led to a number of Welsh publishing houses – such as Gwasg Gomer, y Lolfa, and Gwasg Gwynedd – and the development of a number of Welsh language magazine publications such as Golwg.

There has also been a particular revival in the production of children’s literature through the medium of Welsh during the past 30 years, driven mainly through a revival in Welsh language education.

While it would be expected that publishing would be a strong area for development, there are examples of a new type of professional Welsh language entrepreneur emerging in knowledge-based sectors such as media and television, mainly as a result of the commissioning activities of the Welsh language television channel S4C.

With much of this activity focused around Cardiff where both BBC Wales and S4C are located, the expansion of this sector follows a trend where much of the recent growth in Welsh language businesses has been outside the Welsh language heartland.

This development was driven by the increased demand for language skills which emerged as a direct result of the Welsh Language Acts which created unprecedented job opportunities for those who can speak the Welsh language.

This has led to a massive growth in translation facilities and an increase in the demand for the use of the Welsh language in large cities such as Cardiff and Swansea, which are traditionally non-Welsh-speaking areas.

The subsequent growth in Welsh-speaking professional classes, combined with a revival in terms of Welsh medium education in the same urban areas, has resulted in an increase in demand for educational services such as Welsh-speaking nannies and Welsh language nurseries in traditional non-Welsh speaking areas, thus creating more new businesses.

While such growth in new ventures is to be welcomed, it has been suggested that the expansion in the number of Welsh language entrepreneurs within non-Welsh speaking areas may actually be posing a real threat to the economic viability of the Welsh language heartlands as many are started by those who have moved away from those areas.

Indeed, the potential danger of a “brain drain” is exacerbated by the fact that these areas are already among the poorest in Europe and are those which can least afford to lose their entrepreneurial and talented young people to the more prosperous metropolitan regions.

Of course, given this situation, the question is how government should address this exodus by young Welsh speakers and whether there should be specific policies to encourage greater entrepreneurship within the Welsh language heartlands?

For example, following the demise of the Entrepreneurship Action Plan for Wales, business support programmes have been mainstreamed into a “one size fits all” approach. Given the need to encourage enterprise within the Welsh language heartlands, some have argued that there may be scope for strengthening support for potential and existing Welsh speaking entrepreneurs.

Others would contend that the Welsh language itself has little to do with the ability of most businesses in the Welsh speaking heartlands to succeed. What is more important is developing the right type of infrastructure – such as improved broadband, access to the right skills and transport links – that enable businesses in the rural Welsh-speaking parts of Wales to develop and grow.

Whatever the solution, it is clear that for the economic prosperity of Wales to develop, we must ensure that both Welsh speaking entrepreneurs and businesses which are based on the Welsh language are given the full support to flourish wherever they are based.

HART OF THE ECONOMY?

Should we be worried when a candidate for the job of First Minister shows a distinct lack of knowledge of the state of the economy?

Judge for yourself from the interview today with Edwina Hart in the Western Mail where she made the following statement in response to a question on the future of the Welsh economy:

“The key story of the Welsh economy, until the recession, was of its success. The UK economy grew at a faster rate than other industrialised nations; the Welsh economy grew faster than the UK economy and, within Wales, the economy of West Wales and the Valleys grew faster than Wales as a whole".

This sounds like great news until, of course, you examine the veracity of each of these statements in relation to the time period since Labour came to power in 1997.

The UK economy grew at a faster rate than other industrialised nations

INCORRECT - During the period 1997-2007, Ireland registered the greatest increase in real GDP per capita, followed by the Republic of Korea, Hong Kong, Sweden and Spain.

The Welsh economy grew faster than the UK economy

INCORRECT - During the period 1997-2007, GVA has grown in the UK by 68.7 per cent. In contrast, GVA in Wales has grown by 54.1 per cent – the lowest of any UK region apart from the West Midlands. England grew by 69.1 per cent.

Within Wales, the economy of West Wales and the Valleys grew faster than Wales as a whole

INCORRECT – During the period 1997-2006, GVA in West Wales and the Valleys grew by 42% as compared to 53% for East Wales. Whilst it would be correct to say that the gap has begun to close during the last few years between the two parts of Wales, that is not surprising given the additional billions poured into the region during the period combined with the decline of Wrexham and Flintshire, which grew by only 29% over the decade.

I am surprised no-one has picked up Mrs Hart on these 'exaggerations' regarding the state of the Welsh economy.

One can only hope, if she is successful next week, that she does not use the same statement as the basis for the real economic policies needed to bring Wales out of recession.

THE PLAID LED ASSEMBLY GOVERNMENT

It always brings a wry smile to my face when I hear that various Plaid Cymru backbenchers, whenever a WAG policy announcement has been made, have claimed that this or that brand new initiative is down to their interventions within cabinet.

Obviously the most recent example concerns ProAct, which the Deputy First Minister and his colleagues are forever claiming as their idea, even though it was developed within DCELLS, Jane Hutt's department.

However, after observing today's shenanigans in the Chamber, it is clear that when it comes to the referendum on devolution, it is Plaid Cymru that is leading the argument within the coalition government.

In an example of backpeddling that, if it was an Olympic event, would make Rhodri Morgan a gold medal winner, all that had to happen for him to go into full reverse on an earlier Labour Party policy decision was for a couple of Plaid backbenchers to stand up and say that, as Labour would not promise a referendum before the next General election, they just wouldn't stand for it and (hint hint) could vote to end the coalition.

Within a short space of time, we had statements rushed out by the Labour leadership to emphasise that they had been misunderstood and that it was all a great big mistake.

What a legacy of ten years in power by the First Minister!

The minute that Plaid Cymru feels uncomfortable about a Labour party policy on devolution, Wales' best known politician and his previously perfect sense of logical arguments ended up going round in circles like, to quote the man himself, a one legged duck.

Whilst Jonathan Morgan speculates whether it is Peter Hain or Rhodri Morgan who leads the Labour Party, today's fiasco has shown the Welsh Assembly Government is not led by Labour, but its partner in coalition.

I would imagine that Plaid Cymru will be ecstatic this evening at the tail literally wagging the dog although what the Labour leadership contestants will make of this fiasco, and their reaction to it after the result is announced next week, is the real political story from today.

CONSERVATIVES CLOSE GAP IN WALES?

Perhaps what many have failed to notice in general excitement of the YouGov/ITV Wales poll on a referendum for the Assembly are the voting preferences of those sampled for the next general election.

Unless I am totally mistaken, it looks like the Conservatives are running only a few percentage points behind the Labour Party in Wales. Compare this to the situation in 2005 when the voting intentions were 43% Labour verses 21% Conservative.

This reinforces the October poll results from YouGov and seems to suggest that the Conservatives will continue their resurgence in Wales and, given the concentration of Labour's votes in areas such as the South Wales Valleys, may spring a few surprises in some unexpected constituencies.

MEETING YOUR HEROES

When you are lucky enough to get the position to meet your heroes, there is always an inevitable sense of disappointment.

Actors are boring and self-obsessed, sport stars are always smaller in real life, and politicians are, well, politicians.

Today, I was lucky to meet one of my real academic heroes and the man who created, single handedly, much of the entrepreneurship infrastructure that makes MIT the innovation hotspot that it has become today.

Even at the grand old age of 74, Professor Ed Roberts is a giant amongst academics and one of my personal heroes.

It was the work that Ed did in the 1960s and 1970s which laid the foundation for much of the knowledge we have today on technology-based companies and his research was the inspiration for my own Ph.D on technical entrepreneurship in the UK.

His talk today about the effect of MIT on the US economy was a tour de force and even in his 70s, he has the power to inspire and, most importantly, surprise us.

For example, his recent review of the entrepreneurial legacy of MIT demonstrated that foreign MIT alumni were 50 per cent more likely to be starting their own successful businesses than their US counterparts.

As he said today "About 30 percent of MIT’s foreign students form companies, of which at least half are located in the United States. Those estimated 2,340 current firms located in the United States but formed by MIT foreign-student alumni employ 101,500 people. In other words, talented foreign-born students attending MIT play an increasingly important role in creating U.S. companies, making MIT a magnet for worldwide talent that significantly benefits the U.S. economy".

That is exactly the sort of talent we need to attract to the UK and, more specifically, Wales. However, by pandering to the xenophobes in our society, the recent changes to visa regulations by this government means that it is going to be even more difficult to attract the brightest and the best to this country and the economic loss will be ours.

I managed to have a few words with Ed after his lecture and he was charming, funny and full of knowledge. It was a privilege to meet him twenty one years after I first read his articles and hopefully, we can get him over to the UK next year so he can get some of his important messages across to our policymakers.

WALES - SMALL BUT NOT CLEVER?

It is somewhat ironic that I am sitting here having lunch in the middle of the world class ecosystem that is MIT when my academic colleague Rob Huggins is preparing to give his inaugural lecture at UWIC, in which he argues that Wales seems to lack the ideas to address the lack of innovation within the economy, which is proving a barrier to growth when coupled with the lack of investment in knowledge.

As he states, "Evidence from leading regions around the world indicates that while universities can play an important development role, they are usually supported by a dense system of institutions, including publicly-funded research institutes and laboratories dedicated to applied research".

Of course, nowhere is there a better system to support R&D than that found here in Cambridge, Massachusetts and over the next two days, I will be attending the Regional Competitiveness Conference to discuss how we can partner with MIT to bring some of their best programmes to Wales

One of these programmes is the Deshpande Centre, which was established to help develop examining the commercial potential of novel-early stage research. The great news is that MIT would be willing for us to replicate Deshpande, and other such programmes, in Wales.

Our job now is to take full advantage of such an opportunity.

TAKING THE BEST OF WALES TO THE WORLD AND BRINGING THE BEST OF THE WORLD TO WALES

Today, the University of Wales started its agreement with the Massachusetts Institute of Technology (MIT), one of the World’s leading universities.

Founded in 1861, MIT has produced 75 Nobel Prize winners, seven of which are still working within the institution. With just over 10,000 students, it attracted £383 million of external research funding last year. More importantly, its success in commercialising research is unrivalled globally. For example, it has been estimated that the 25,800 currently active companies founded by MIT alumni employ about 3.3 million people and generate annual world sales of £1.5 trillion, producing the equivalent of the 11th-largest economy in the world.

Today, the University of Wales has become a partner in the Industrial Liaison Program (ILP), which helps leading global companies keep pace with industry changes, develop new products and processes, and adopt innovative management practices.

As part of this arrangement, Welsh companies that are members of the University of Wales’ Global Academy will be given access to world class academic expertise in key science, engineering and technology areas.

This is a real opportunity for Welsh businesses to gain direct access to some of the best academic minds in the World and I am thrilled at the prospect of having companies from Wales gain direct access to the ILP programme which helps businesses worldwide harness MIT's resources to address current challenges and anticipate future opportunities.

The aim of the University of Wales is to take the best of Wales to the world and to bring the best of the world to Wales. This programme is a perfect example of that philosophy and will enable Welsh entrepreneurs to work alongside MIT faculty to monitor emerging innovations in science and technology and explore their potential impacts. It will also give them the chance to explore new management practices and solve specific problems through consulting or research collaboration with the best in their field.

The ILP will also enable Welsh companies to access private workshops and conferences with MIT faculty which can be used to bring outside expert viewpoints into the company’s strategic planning efforts, explore the impacts of emerging and disruptive technologies on the company’s business and consider new approaches to the company’s management and organisation.

Entrepreneurs will be able to gain exclusive access to the “MIT Knowledge Base”, which enables companies to explore emerging technologies that may impact their industry, learn about relevant research at MIT, and identify faculty members working in their company’s area of interest.

This enables companies working with the University of Wales to join an exclusive group of organisations that can, through the ILP programme, gain access to the world class expertise at MIT. Currently, 200 of the world's leading blue chip organisations from across the globe turn to the ILP for professionally coordinated access to MIT experts, research facilities, and information resources that will help them bring innovation to market. The programme offers streamlined access to MIT’s intellectual capital, and enables companies to stay abreast of new technology developments, anticipate changes in the marketplace and sustain growth and profitability.

Today was the first day of MIT 2009 Research and Development conference which all ILP members are invited to on an exclusive basis. Along with 200 other attendees, I listened to lectures by MIT's leading professors on subjects as diverse as energy, materials and transportation, and met with faculty members leading the field in technology transfer, commercialisation and entrepreneurship.

To say that this was a mind-blowing experience would be an understatement and I hope that we can build on some of the discussions we had today to benefit the Welsh economy.

And just to give an example of the calibre of people who are here at the event, I had a chat over coffee with the President of Honda research centre in Silicon Valley who expressed an interest in seeing how Welsh companies could potentially help with his research agenda and given that one of the companies working with us is developing a hybrid engine, there are real possibilities emerging for Welsh firms.

I also discussed the possibility of having teams from MIT come over to assess projects for innovative welsh start-ups and I will be following up on this later this week with the ILP team

That was just day 1 - can't wait until tomorrow....

BACK IN THE USA

This week, I am back in the USA or, more specifically, in Massachusetts visiting a number of universities.

Whilst I will be visiting a range of academic institutions over the next couple of days, my primary aim is the launch of a new relationship between the University of Wales and MIT - one of the top universities in the world.

I will blog more on this later this week but, as I have mentioned previously, there are many lessons to be learnt from the MIT experience.

Indeed, the model is so successful that the Singapore Government is replicating it.

As this article describes, Singapore is looking to copy the success of MIT with its own new institution - the Singapore University of Technology and Design - which will be headed up by former MIT Professor Thomas Magnanti, who headed the MIT School of Engineering - the best in the World.

SU opens its doors in August 2011 and its strategy is based on looking at how the world's great entrepreneurial universities - Stanford, which gave birth to Silicon Valley, and MIT do it. It aims to replicate the 'vigorous entrepreneurial ecosystem' to nurture and support students and faculty who want to launch new businesses.

Singapore is putting in place various measures to encourage a research and innovation culture with SU aiming to become one of the world's foremost universities within the next 20 years, producing 'technologically grounded leaders' who will have an impact on society in different ways.

If only we had the same vision here in Wales. Still, the new relationship with MIT could be the first step....

WAG FAILS ON RECESSION

Yesterday, the all party finance committee came out with what is possibly the strongest criticism yet of the Welsh Assembly Government’s handling of the recession.

Its report noted that rather than focusing on the downturn and dealing with Wales’ growing unemployment problem, Labour and Plaid Cymru had focused instead on delivering the ‘One Wales’ agreement.

As this blog has said time and time again, and despite the spin generated by economic summits, the Welsh Assembly Government simply has not changed its overall approach during the deepest recession since the Second World War.

Nowhere is that more obvious than in WAG's annual spending plans, where the committee noted that:

• funding for health and social services account for 40.3% of the budget next year, while the share for the economy and transport fell from 8.1% to 7.6%.


• there were questions over the savings made by reducing health boards from 22 to seven given the no redundancy pledge, and the allegation by NHS finance directors that up to £1 billion of NHS spending was being used inappropriately


• an apparent ‘lack of coherence’ between ministerial portfolios;


• there were difficulties in measuring £600m of efficiency savings;


• trouble in tracing the effectiveness of cross-cutting policies such as child poverty.


• the Government had not made any significant change to its baseline budget in response to the recession


• there were concerns about funding for schools, colleges and higher education facing 5% cuts.

However, the publishing of the report was marred by the behaviour of the Plaid Cymru AM, Chris Franks, who tried to protect his own leader by allegedly getting one of Plaid’s press officers to draw up amendments to deflect any criticism of the economic development portfolio.

Of course, this is the same AM who, back in August, suggested that Wales was doing better than the rest of the UK economy thanks to his party's effort in 'driving' the Welsh Assembly Government but has been strangely quiet since as unemployment figures have gone from bad to worse over the last few months.

By hiding behind ProAct - as the three candidates for the Labour leadership did last night on Dragon's Eye - both of the parties which make up the OneWales Government seem to have taken their eye off the ball regarding some simple fundamentals to help the economy - such as access to finance for small firms, reducing business rates and utilising European funding - that could have made a real difference to businesses during the recession.

WALES SEES HIGHEST INCREASE IN UNEMPLOYMENT IN THE UK

It has become such a familiar story that even BBC Wales can't be bothered to report on today's unemployment figures showing that Wales continues to perform worse than the rest of the UK.