That doesn’t
mean that it isn’t worth working on.
Every time the public sector in Wales spends our money outside of Wales,
we ‘lose’ a bit of potential GDP. Our money
ends up circulating somewhere else and adding to their GDP rather than
ours. There are environmental advantages
to having a shorter and more local supply chain as well. And I have no doubt that more local
procurement will boost the number of jobs here in Wales.
I’m a little
sceptical, though, about the headline figure of 50,000 extra jobs. It’s a nice round number – too nice and too
round for my mathematical mind. And, of
course, ‘local procurement’ doesn’t only work one way; other areas of the UK
might follow the Welsh lead and seek to procure their goods and services more locally,
which would lead to a loss of jobs in Wales.
Overall, though, I’m confident that we buy more from elsewhere than we
sell there, so that we’d be net gainers, even if not quite on the scale
suggested.
What we do need
to be clear about though is that this isn’t, whatever the headlines might say,
about ‘creating’ jobs. ‘Creating’ is a
word that politicians love to use when talking about jobs, and it’s easy to
present the opening or expansion of a factory or office as something which ‘creates’
jobs. But much of it is really just ‘relocating’
jobs rather than ‘creating’ them. Buying
the same goods and services from a different and more local supplier doesn’t
result in an overall increase in economic activity; it merely moves economic
activity from one place to another. Only
by drawing lines on maps and looking at what happens on just one side of the
line whilst ignoring what happens on the other does it look like ‘creating’
jobs.
To repeat –
that isn’t a reason for rejecting the policy or for not doing more to bring it
about. It’s a policy which would bring
significant benefit to Wales. But it can
never be enough. Real job creation
depends on increasing rather than just moving economic activity.
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