Is decline in the UK’s post industrial places is now as psychologically fixed as it is structurally? One of the observations from the latest UK competitiveness index, or NICE Index Report 2025, produced by Robert Huggins of Cardiff University and Piers Thompson at Nottingham Trent University, is that people in these places, such as the coalfield of South Wales, are – as Dylan Jones-Evans puts it – living in a kind of self-fulfilling prophecy. The decline is not simply a symptom, or manifestation, of the end of heavy industry – it is both a social input (where apathy and disengagement are enormous factors contributing to spatial decline and decay) and output, given the human consequences of economic impoverishment. Behaviour in these places is not only dictated by the decline people see around them, but is now also embedding this bleak economic environment. Self-limiting mindsets, is how the report terms these behaviours.

This assessment is particularly relevant to the Valleys of South Wales which has endured well-recorded generational decline. I wonder how accurate a depiction this is, however.

The decline of these areas doesn’t only go back to the end of the Miners’ Strike, or the election of Margaret Thatcher’s government a bit before. Industrial atrophy, especially in the South Wales coalfield arguably began in the 1920s when output started to fall. Economic experimentation has since become as intrinsic to the policy fabric of these places as anything else, to the extent where a lull in the policy cycle (as there seems to be now) feels alien.

Prof Huggins lays it out quite starkly: Wales is “economically cut off” from the rest of the UK; the physical infrastructure deficit allied with behavioural barriers in post-industrial places means there are innovation deserts across the country; the towns and villages of the South Wales Valleys are at the very bottom of economic competitiveness index. It’s all rather depressing.

It need not be. And I don’t imagine the statistics reflect the reality either.

Rebuilding places

An answer to a decline or constant deficit in competitiveness often outlined is to empower entrepreneurialism, to establish a creative business landscape for enterprise to flourish. We’ve seen how the foreign direct investment movement failed, we’ve seen how largescale infrastructure (the Heads of the Valleys Road improvement, the establishment of a so-called South Wales Metro system) can only do a little bit in engineering growth. Government needs to intervene so it can create an environment for entrepreneurial ecosystems to thrive. Change mindsets. I simplify, but a message is that intervention should only go as far as creating the environment for business to thrive and leave that to happen. The less government the better. But there still needs to be some government. And a very specific kind as well.

Iterations of this – and pretty much every other liberal economic idea – have been trialled before and haven’t really done very much. That fact is plain if we are to take the NICE data at face value.

I come at this from a perspective that competitiveness obsessions are a part of the problem. In fact, the NICE report kind of acknowledges this. It argues the UK’s industrial strategy is problematic as it assumes infrastructures are in place to support such a plan already. They are not. Unfortunately, 40-odd years of neoliberalism, 15-odd years of austerity, five years of geopolitical flux, have stripped away the structures needed to trigger the kind of innovation that, I don’t know, might see the Garw Valley become a centre of global AI development, for example. Add this to underlying economic decline and the tragedy of de-industrialisation becomes even more unsolvable. The most wicked kind of Rittel and Webber’s wicked policy problems.

This brings me to another matter. Why should one village be higher up the league table of innovation than another? Doesn’t this necessarily mean that one place will always be worse off than others? If London and the south-east of England are centres of UK innovation, then outlying parts will always be behind them… That’s the nature of an economic system which prizes wealth and wealth creation ­– competition – over anything else. Disparity is elemental to it. In a competition, there are always losers and always winners. This surely goes for economies too. It cannot be helped that in Wales some of our most unequal places, those in the coalfield, have geographies which makes “competitiveness” an inherently difficult and challenging economic construct.

Because that’s what this ultimately is. A construct. A construct that, yes can trace its history back to the beginning of the end of coal, but one that was embedded and, actually, made much more difficult to solve or turnaround, by Thatcherism and the political experiment which unloaded heavy industry to other parts of the world and dismantled our labour-intense economies.

Imagining a social economy

The way out of the social challenges in Valleys communities isn’t in some far off, fairytale land of entrepreneurialism. It’s there already. It’s there in the fragments of the foundational economy which have resisted the storm of neoliberalism. These fragments, in the social infrastructures of the every day, are innovative and prosperity-creating. But they’re not innovative in the way a competitiveness index would measure them, and nor should they be. They exist in the casual co-operativeness which is so inherent to Valleys communities. They exist in the closeness to nature; in the shared heritage, history, and culture of these places. They are less measurable than wealth in our conventional understanding, but I would argue that they exist, nonetheless. These are themes which I plan to explore much more through this blog as my research on the Foundational Economy goes on; themes which I think need to be unpicked through the lens of the people living their lives in these places.

There is something self-limiting about ranking communities on the basis of their competitivity. I say this as someone who has always enjoyed reading the NICE report, since I was a business journalist at the Western Mail nearly 20 years ago – it provides critical insight into economic stories in places anchored by the ghostly echoes of our industrial past. But it’s not the totality of those stories.

Let’s reimagine our economy then. Let’s see democracy, through governance, as an institution for positive change and, yes, innovation. That’s not merely through the route of procurement for health and education services, but by government playing (dare I say) an active role in systems, in organising networks, in investing in community-led enterprise, in establishing an economy not of profit, but of wellbeing. We want to create prosperity, but establishing a new social stratum of entrepreneurs won’t really do that – nor will it establish the civic stakehood so badly missing in many places. It can be done by genuine, collaborative and people-led innovation. Through community, rather than individual, empowerment.

Co-operativism is not a quality in strong supply when we strive for competitiveness. But it can be a means to strengthen and build new kinds of wealth in places strangled by the hold of liberal economics. This destructive force is one that for some reason is returned to for ideas about reducing inequalities when it has caused those inequalities in the first place.

If we really want to reshape and reinvigorate lost communities, however, the orthodox just won’t work anymore.