Foundational Economy

Foundational Economy


The Foundational Economy is relevant to both policy-makers and place-makers. Cynnal Cymru works with both to explore and explain why this part of the economy matters to sustainability.

What is the Foundational Economy?

The Foundational Economy covers those areas of the economy that provide the goods and services essential for everyday life — health and social care; food; housing; energy and utilities; construction; retailers on the high street; and tourism. These are the ‘zones’ of the foundational economy.

These goods and services are generally provided by:

  • Public bodies (directly or through funding outsources activities)
  • Small and medium enterprise (SME) firms
  • Large companies such as privatised utilities or branches of mobile companies, such as the major supermarkets

The presence – or absence – of a thriving local foundational economy can have a profound impact on places and their communities. This directly affects goods, services, distribution of income and skills, and job opportunities, but with secondary effects on wellbeing, community, and health.

Why does the FE matter?

  • FE is the part of the economy providing for essential human needs, regardless of geography, income or status
  • Estimates suggest that the foundational economy provides four in every ten jobs in Wales and receives £1 in every three that we spend
  • The businesses and institutions within the FE have a major role to play in helping tackle the nature and climate emergencies, through the ways that they help influence supply chains and customers, as well as through their own operations
  • In some parts of Wales the ‘foundational economy’ is the economy.
A Foundational Economy built on principles of Fair Work and functioning within climate and environmental limits is key to achieving a Prosperous, Resilient, Healthier and More Equal Wales.

What is Cynnal Cymru's role?

Cynnal Cymru facilitates a community of practice on the foundational economy on behalf of Welsh Government. It focuses on core foundational sectors of Food, Social Care, and Future Skills. 

The FE CoP meets regularly to exchange knowledge, share learning, and encourage innovation. A key role is to help broker links between projects and partners from all sectors, with a view to practical problem-solving and collaboration. The meetings are member-led and highly participative, with reprresentatives from local authority and housing association backgrounds, training providers, community organisations and third sector networks, and Welsh Government officials.

If you would be interested in joining a session or finding out more, please get in contact via

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Get in contact

If you have any questions or would like to find out more, please get in touch.

Tel. 029 2294 0810

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