Welsh firms identified as productivity heroes in new report
More than 1,700 Welsh businesses have been identified as “Productivity Heroes,” according to new research published by Economic Intelligence Wales (EIW). The report, launched at a breakfast briefing co-hosted by the Federation of Small Businesses (FSB) Wales, finds that these firms generated £6.04 billion in turnover and created over 5,200 jobs in 2024-25. The analysis sets out the main characteristics of high-performing small and medium-sized enterprises, showing that targeted investment and strong leadership can unlock economic growth across the country.
Why Wales’s High-Performing Firms Succeed
Labour productivity increased by about 24 percent, rising from approximately £133,000 per employee to almost £165,000. The report highlights that these firms operate across manufacturing, construction, professional services, wholesale, and hospitality. Regardless of sector, the most successful businesses consistently invest in three areas: a strong customer focus; developing people through leadership and skills; and adopting new technologies and digital tools.
Swansea-based Zeal Innovation, trading as LITELOK, designs and manufactures high-security locks for bicycles and motorcycles. The Development Bank-backed company has grown turnover per full-time employee from around £45,000 to around £350,000 since 2017, with annual revenues now approaching £10 million. This growth demonstrates how innovation and a strong product focus can help Welsh businesses scale while improving productivity. Professor Mark Hart, lead author of the report and Deputy Director of the Enterprise Research Centre, said that the strongest-performing businesses invest just as much in leadership, workforce development, and organisational culture as they do in innovation.
Identifying firms through this framework provides a more meaningful understanding of economic performance than measuring turnover or employment growth in isolation. By identifying businesses that are simultaneously growing turnover, employment, and productivity, the research offers a stronger evidence base to inform future policy and support. This approach helps policymakers target resources where they can have the greatest impact, moving beyond simple growth metrics to understand how firms sustain performance over time.
Widening the gap between Wales and the rest of the UK will require a step change in the nation’s productivity growth. Professor Melanie Jones, Academic Lead for the Wales Productivity Forum, noted that productivity growth is critical to improving real wages, business profitability, and public service delivery. Events like this, which support the sharing of best practice and collaboration between policymakers and business leaders, are key to achieving this goal. The findings offer practical insight for those seeking to support firms that are already performing well, but they also raise questions about how to scale these practices across the wider business community.
How to Create More High-Performing Firms
Adam Price, the Cabinet Minister for Enterprise, Connectivity and Energy, opened the event. He said Wales has the businesses and ambition needed for a stronger economy. The national productivity mission focuses on turning potential into higher pay. The Minister believes that with the right support for skills, leadership and innovation, more Welsh firms can grow. He noted that a new national development agency will make support simpler and more effective.
Professor Melanie Jones highlighted the 15 percent productivity gap between Wales and the rest of the UK. She said that closing this gap requires a step change in Wales’s productivity growth. The gap affects real wages, business profitability and public service delivery. She stated that events which support understanding and sharing best practice are key. Collaboration between policymakers and business leaders is essential to achieving the goal of higher productivity.
Professor Mark Hart argued that Productivity Heroes prove businesses do not have to choose between jobs and productivity. These firms achieve both, making them important for Wales’s long-term performance. His research shows that strong businesses invest in leadership and culture. He stated that understanding what sets these firms apart helps create more of them.
Giles Thorley, Chief Executive of the Development Bank of Wales, said the research provides valuable evidence. He stated that the role of the bank is to turn evidence into support. The bank works alongside the Welsh Government to help ambitious businesses. They provide finance, leadership support and investment to improve productivity. The framework helps translate evidence into practical action.
