Page last updated at 06:55 GMT, Thursday, 8 January 2009

Spotlight on shops as gloom grows

Nick Servini graphic
WELSH ECONOMY UPDATE
By Nick Servini

Woolworths store

BBC Wales' business correspondent gives his latest assessment of how the Welsh economy is faring during the downturn.


So how tough are things going to get for us this new year?

It's practically impossible to say with any certainty.

Richard Lambert, the director general of the CBI, said as much when he addressed the great and the good from the Welsh business scene last month.

Forecasting, according to him, had become worthless.

And at the latest Welsh economic summit, First Minister Rhodri Morgan said that when he asks his own economic advisers about how long the downturn will last, the response he gets is: "God knows."

What we do know is that certain areas will come under more pressure than others.

Like a broken tooth in the face of retailing
Surveyors on the gap left by the closure of Woolworths

Retailing is under the spotlight at the moment. The Christmas trading figures are still being digested, but everyone is hoping the events at Woolworths won't set the tone for people working on the high street.

It's bad enough for anyone knowing they're going to lose their jobs, but then to have to preside over a fire sale like we've seen at the once-dominant retailer makes it doubly worse.

The manager of one Welsh store sold his desk for 50. For the shoppers of course there were great bargains, although one elderly shopper in Barry said she felt like she was looting the place on the final day.

Closing down signs
Empty sites can leave a gap in shopping centres

For the staff who have lost their jobs, there are retail developments like St David's 2 in Cardiff.

It will provide new opportunities, but in most towns and cities, competition for jobs on the high street will become fiercer.

And then there's the question of whether anyone will move into the vacated premises.

Heavy manufacturers

Two years ago these prime sites would have been snapped up by other retailers or developers; now I'm not so sure.

It will be interesting to see whether big empty shells are left on high streets across Wales. In towns like Aberdare and Cardigan, the main group representing surveyors says it will leave a gap "like a broken tooth in the face of retailing."

Away from the high street, life will continue to be tough for some of our heavy manufacturers in particular.

Steelmakers Corus and Ford were both forced into extended Christmas shutdowns. It's difficult to see how things could pick up in the short term.

However, we have to remember that there are winners as well as losers.

The low value of the pound is currently helping exporters and like in any downturn, those that adjust to the new reality the fastest will pick up the prizes.

Print Sponsor


SEE ALSO
'No easy economic cure' warning
28 Dec 08 |  Wales politics
New jobs warning after 'grim day'
27 Nov 08 |  South East Wales


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

PRODUCTS & SERVICES

Americas Africa Europe Middle East South Asia Asia Pacific