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South Wales- Area of declining Industry
Ebbw Vale is a small town in South Wales.
In the past South Wales had developed to become a centre of iron and steel
industry during the industrial revolution. These are raw material orientated
industries and it has good access to raw materials as it was on coal and iron ore
fields. Imports and exports are high bulk/low value so need to have close/good
transport links to keep profits high and South Wales is on the coast.
Linked to iron and steel are heavy manufacturing industries such as car
production, manufacturing etc. which are labour intensive so many jobs were
created due to the iron and steel industry.
A decline in industry
However in 2002 there was the final closure of a tin plating plant. The area had deindustrialized.
This was due to:
i. Resource exhaustion meant the local supplies of coal and iron ore were used up. Iron and ore is a raw material
orientated industry so moved away as there were no more raw materials.
ii. Increased competition from abroad. Countries such as China could produce steel that was much cheaper as there
is less government regulations, low wages, low set up costs etc. that mean places such as China produce a
greater profit. This made British steel `too expensive' so demand fell. Less business means the industry cannot
afford to keep carrying on.
iii. The previous year British steel had merged with a Dutch steel producer and the new TNC, Chorus, was
rationalising so the plant in South Wales was closed.
There were many effects of the deindustrialization.
Large areas of wasteland and brownfield sites left over from where the industry used to be. These areas are
contaminated from the chemicals used by the industry which ruins habitats and reduces biodiversity. It is also
very expensive to clean up.
There are large areas of derelict land with high levels of physical disorder (due to neglect, vandalism etc.)
which encourage crime and make an area unappealing.
Nearly 800 jobs were lost directly through the decline of industry. These were mostly male, traditional heavy
industry jobs which are unskilled meaning it is difficult to find new jobs. Many more jobs were lost due to the
negative multiplier effect as people who were unemployed no longer have money to spend in local services
which causes them to close through lack of business. Over £30 million was lost to the local economy.
This resulted in the highest unemployment rate in Wales as over 2000 were unemployed.
40% of those still in employment were in manufacturing. This is twice the national average. This is a large
overdependence on one sector of the economy and manufacturing jobs are still declining in the UK so 40%
have jobs at risk which could lead to more unemployment.
High levels of unemployment link with high levels of crime and South Wales has high crime rates leading to a
poorer quality of life for residents.
People have lower disposable incomes so cannot afford luxuries such as tvs, leisure activities etc. so have a
poorer quality of life. Negative multiplier effect means services such as education & health care close down
so families have poorer access to services which lead to multiple deprivations resulting in a poorer quality of
Many motivated young people and males moved away to find work and people who are more educated
moved away to find higher paying jobs. This lead to an unmotivated and ageing population who are less likely
to find work which means local economy sank further.
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Different organizations decided to tackle the problems caused by deindustrialization.
i. The local government offered incentives to attract companies to the area and set up development areas
ii. The national government, local government and private sector invested £60 million into an area known as
Welsh Development Area. This consisted of:
a. Built new industrial estates to provide ready built factories which were the right size & shape to attract
companies to region as there is lower setting up costs for companies