Guidance

The foundational economy

We want to improve the basic goods and services that everyone relies on.

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First published:
24 September 2024
Last updated:

Contents

What is the foundational economy

The foundational economy includes sectors that provide the goods and services we use every day.

These sectors:

  • shape the services we use and the places we live
  • are a vital part of daily life and our communities

We want to support the people and organisations working in these sectors to:

  • make sure their services are high quality and easy to access
  • give people a greater sense of control and belonging in their communities

Sectors we focus on

We are focused on the following parts of the foundational economy:

  • care and health services, including social care and childcare
  • management of social housing
  • construction of residential and commercial buildings
  • energy and utilities
  • food
  • high street retail and services
  • tourism
  • public transport

Why the foundational economy matters

Supporting the foundational economy is a key commitment in our Economic resilience and reconstruction mission.

The foundational economy accounts for:

  • 60% of all Welsh headquartered businesses
  • 51% of employees of the Welsh VAT registered businesses
  • 47% of overall turnover in Wales
Map of Wales showing FE businesses as a percentage by region, ranging from 51% to 73%.

Strengthening the foundational economy is vital for addressing challenges such as:

  • addressing the climate emergency
  • job creation, retention and improvement
  • developing future skills
  • expanding public transport
  • rolling out digital technology
  • creating a resilient food system
     

What we aim to achieve

  • strengthen the foundational parts of the economy, making them more resilient to external shocks
  • support Welsh businesses to embrace fair work principles and create high-skilled jobs
  • improve working conditions, ensuring fair work, skills improvement, and career progression
  • sustain and grow locally-owned businesses to circulate profit and wealth in Welsh communities
  • enhance access to foundational economy goods and services, improving wellbeing across Wales

Read about our objectives and methods in the Foundational economy: mission statement.

Our approach aligns with the Well-being of Future Generations Act 2015.
 

Case studies

  • Woosnam Dairies: a local milkman became a key school milk supplier in Wales with help from Caerphilly Council.
  • Awen Cultural Trust and B-Leaf: growing local produce sustainably while creating jobs for adults with learning disabilities.
  • NappiCycle: using recycled fibres from Bluestone National Park Resort in road and pavement construction.
  • Can Cook: providing fresh, nutritious meals, supported by our Backing Local Firms Fund to tackle food poverty.
  • Velindre University NHS Trust: promoting sustainable food sourcing within the NHS,supporting a resilient Welsh food sector.
  • Simply Do Ideas: helping public sector organisations overcome barriers using digital innovation.
  • Castell Howell Foods: collaborating to drive social, environmental, and economic change in the supply chain.
  • Caerphilly County Borough Council: leading the reform of food procurement strategies in local supply chains.
  • NHS Wales Shared Services Partnership: updating food procurement strategies by using more local suppliers in the NHS.
  • Harlech Foods: promoting and supplying Welsh food produce to the public sector. 

Further resources

First published

24 September 2024

Last updated

Part of