Dr Wyn Meredith chair of CSconnected on the emerging compound semiconductor cluster in South Wales and why the new Welsh Government must move fast to secure its future potential for the people of Wales.
Tech firm KLA which plays a key role in the growing compound semiconductor cluster in South Wales.
Somewhere in South Wales, right now, an engineer is working on technology that will end up in the electric vehicle you drive, the 5G signal you use, the radar system that keeps aircraft safe.
You may never have heard of the industry that employs the engineer, but it has been building steadily since the 1980s and today is globally recognised for its skills, knowledge, and capabilities in compound semiconductors, the chips needed in all elements of modern tech.
Since a formal launch of a cluster strategy in 2015, its value has gained recognition with Welsh politicians, and the compound semiconductor cluster appeared in three Welsh election manifestos. Plaid Cymru, now forming the new Welsh Government, committed explicitly to its “continued development.” Welsh Labour called it “world-leading.” The Welsh Conservatives referenced it as a national priority.
For those of us who have spent the better part of two decades building this cluster, the world’s first of its kind, that recognition is a source of great pride. But recognition alone is not enough. The first 100 days of this new government represent a defining window of opportunity to realise that potential.
The new industrial revolution of Wales
Cardiff University’s Welsh Economy Research Unit recently published the evidenced story of what targeted industrial investment can achieve here in Wales.
The South Wales compound semiconductor cluster now supports £436m of Welsh GVA and 3,140 Welsh jobs. Those jobs pay an average salary of around £66,000, roughly twice the Welsh median. More than 90% of output is exported, making this one of the most intensely export-led sectors in the Welsh economy. Every £1m of GVA the cluster generates supports a further £630,000 in Welsh supply chains and communities. Since 2020, Welsh jobs supported by the cluster have grown by 51%.
This growth has happened during a period when UK manufacturing employment has broadly been under pressure, and much of Welsh heavy industry has gone the same way. The cluster did not grow despite those conditions, it grew because of the deliberate, structured way it was built. Targeted public investment attracted significant private capital, while academic and industrial partners worked together as a quadruple helix, supported by the not-for-profit convenor of the cluster, CSconnected.
The model has worked well, and a structure is now in place that is ready for growth. The newly appointed Welsh Government must now act quickly to take the cluster to its next level and avoid competing nations moving faster.
The global race Wales cannot afford to lose
The United States has committed billions under its Chips Act. The European Union has mobilised the European Chips Act. South Korea and Taiwan are scaling aggressively. Every month that passes without the decisions the cluster needs, our global head start narrows. Wales has built something remarkable, the world’s first compound semiconductor cluster, a globally recognised hub for an industry that will be worth a trillion dollars by 2030. The new Plaid Cymru government has inherited that asset. With Adam Price, the new Cabinet Minister for Enterprise, Connectivity and Energy, taking on direct responsibility for its future.
The cluster’s ambitions are clear and published: £1bn in revenue and 6,000 skilled jobs by 2030. Those targets are achievable. But achieving them requires an acceleration in the conversion of committed public investment into operational funds. Decisions that have too often moved in different directions. Inward investment, planning, skills, and infrastructure must work together. And Wales must work with Westminster to make the case for the cluster at UK level, where the next phase of catalytic investment will be decided.
What this means for the people of Wales
While the cluster’s infrastructure is concentrated in South Wales, its economic reach goes far beyond this region. The cluster supports £567m of GVA across the whole UK, with £436 million staying in Wales. Supply chains extend across the whole of Wales. The skills pipeline draws from universities and colleges across the entire country.
And the high-wage, export-led, Welsh-rooted jobs the cluster creates are exactly the kind of jobs the people of Wales can benefit from: well-paid, rewarding, future-proof sticky work in a growing industry. These have been grown here, and can stay here: Welsh engineers and researchers, working alongside world-class global partner.
Invitation
To the new Welsh Government, the compound semiconductor cluster will be ready to work with you from day one. Our door is open, so come and see what has been built across Newport, Cardiff and Swansea. Meet the engineers. Walk the facilities. Experience the career opportunities available. Your first 100 days are an opportunity to turn that combination into something lasting.
- Dr Wyn Meredith is Chair of CSconnected and founding director of the Compound Semiconductor Centre. He has worked in the compound semiconductor industry for more than 25 years.
