The biggest problem facing Wales is the lack of funds to fund local government services, the latest report from the Institute of Economic Affairs (IEA) suggests.
It said that Wales had the lowest proportion of income earners on the books of any country in the UK, with the proportion of the population that earns more than £30,000 a year falling to just 13 per cent in Wales in 2016/17.
The IEA said it had identified three areas of concern for the Welsh economy: the economic situation in the regions of Wrexham and Swansea, and the overall health of the public finances.
Wrexham had the highest percentage of the working population with a rate of 59.4 per cent.
“The regions are struggling and there is no sign of a recovery,” the report said.
The report also said Wales was struggling to attract new companies to the region.
In Swansea, the regional economy is forecast to shrink by 3.5 per cent by 2030, with unemployment and underemployment in the region at 13.7 per cent and 20.6 per cent respectively.
As part of its strategy to attract businesses, Wales also has invested £1bn in the regeneration of its riverside town of St Giles in Wales, which will have a regeneration programme that includes a £1m programme to transform the town centre.
St Giles is also due to receive £2m in new funding in 2020.
At the same time, the report also identified areas where there were some positive signs, including the number of people working in the public sector, the number in full-time work and the proportion that was employed part-time.
Wales had a positive growth rate of 2.4 percent between 2000 and 2015, while Wales’ average rate of growth was 3.1 percent.
On a monthly basis, Wales’ GDP grew by 0.8 percent between the end of 2016/2017 and the end.
This was down from 2.6 percent in the same period last year.
However, the IEA noted Wales was still facing significant economic challenges, with GDP per capita growing at the fastest pace in the EU, at 0.2 percent.
Its latest forecasts for GDP growth for 2019/20 show GDP per person rising by 0