Real jobs for real people

Last week, Ieuan Wyn Jones, the Minister for Economy and Transport, stated his party, Plaid Cymru, was “calling for a fiscal stimulus during this recession – a stimulus targeted at real jobs in the real economy, not at banks, bankers, insurance companies and the City”.

With bankers such as Sir Fred Goodwin being vilified for their role in creating the credit crunch, it is easy to play the role of the populist politician and apply the same broad-brush criticism to the rest of the financial services industry.

However, given his own department has identified this as a key sector to nurture and support, many would be surprised and disappointed at this sudden case of selective amnesia regarding the importance of banks, insurance companies and other financial services companies to the Welsh economy.

According to the Welsh Assembly Government, there are more than 1,800 financial services companies located in Wales, employing nearly 30,000 people and contributing more than 5% to the prosperity of the economy.

Within this group, banks and building societies are the largest employer with 62% of the financial services workforce, although the insurance and pension industry accounts for 21% of all employees in the sector. Those concerned with inward investment activities have rightly targeted the attraction of such companies from their expensive London bases for the past two decades.

As a result, banks such as HSBC, HBOS and Lloyds TSB have been supported in setting up their operations here in Wales, along with major insurance players such as Legal and General.

Of course, the jewel in the crown of the financial services sector is not an inward investing company but a homegrown success story.

Established in 1993, Admiral Insurance has become one of the major triumphs in the financial services industry over the past 15 years.

Led by the irrepressible Henry Engelhardt, the company is Wales’ most successful stock market flotation and, for the fifth year since it went public, delivered record profits in its past financial year. Indeed, it posted pre-tax profits of £202.5m on a turnover of £910m in 2008, and continues to expand its operations at home and abroad.

Most importantly, Admiral – which employs more than 2,800 staff – is an exemplar to all other businesses in the way it supports the development of its employees.

Yet again, the company was named one of the 10 best employers in the UK in the Financial Times list of the UK’s 50 Best Workplaces, and is one of only 10 companies to feature in the list for each of the six years it has been compiled.

If there was ever a case of one business demonstrating it has real jobs for real people in Wales, then this fantastic insurance company surely is it.

Admiral, however, isn’t the only homegrown entrepreneurial success story within this sector.
The North Wales-based company, founded by Simon Nixon in 1999, has helped to revolutionise the way in which the financial services sector operates on the internet.

Small niche companies, such as YS3 and HHF PLC, have also been making their mark as regular entrants on the annual list of Wales Fast Growth 50 firms, developing new areas of financial services which are key to providing funding and support to both consumers and businesses.

Therefore, with thousands of well-paid jobs across Wales, and companies that are making a significant difference to their clients, the financial services sector is one to be celebrated, not disparaged, by our elected politicians.

But it isn’t only in terms of wealth and employment that financial services companies are having an impact on Wales. While politicians are being judgmental about the sector, it is easy to forget that without the support of financial services firms in Wales, the arts, sports and culture sector would also suffer.

Where would the National Eisteddfod be without HSBC’s financial support?

Where would grassroots rugby be without the Principality Building Society’s sponsorship?

Perhaps in the future, politicians, especially those with an economic brief, would be wise to consider their reaction to the current recession before casting aspersions on the tens of thousands of hard-working employees of key firms in the economy of Wales.

It may play well with the party faithful but it is clear from the success of companies such as Admiral, and others, the sector is providing real jobs for real people and without it, the Welsh economy would be a poorer place.

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