Learning to change

When the Labour Representation Committee was formed by the Fabians, the trade unions and others in 1900, it set out to use democratic politics to tackle the inequalities thrown up by the industrial age. Exploitation and social decay were exploding in the new cities, as new combinations of technology and labour bred a new generation of wealthy industrial capitalists. The political establishment of the Whigs and Tories struggled to keep up with the pace of social change and inequity, making the formation of the Labour party essential to prevent bloody revolution.

It was a very different world to the one we find now. Then life expectancy in the UK was 48 years and the average working week was 54 hours. Thanks to technology and progressive politics, those have changed to 77 and 38 respectively.

This change continues apace. Professor Lynda Gratton’s Future of Work centre argues that we are now at the dawn of the 100 year life. Digital technology is redefining geography and combining with labour to redefine work and jobs.

The growing corporations of our age are known as GAFA: Google, Amazon, Facebook and Apple. The combined annual revenue of these four corporations is around $500bn, generated by around 500,000 employees. Walmart may be still the biggest company, with annual revenues of $485bn and 2.2 million employees, but the drivers of change all seem to be coming from Silicon Valley.

What are the inequities of the post-industrial age? And is the Labour movement likely to go the way of the Whigs, as part of an out-moded political establishment? Or is it agile enough to offer hope and security in this new reality?

Questioning the taxes paid by the GAFA companies is just a start. The inadequacies of individual nation states to provide a proper regulatory framework for these super powers is an important part of the nationality debate.

But what is the deeper effect of digital business on wealth creation and work?

In business, the internet is “evaporating the middle”, as the American entrepreneur Gary Bolles puts it. Inspired by John Hagel’s formative Harvard Business Review article of 1999, Bolles describes how the old vertical integrations are being ‘unbundled’ into horizontal networks, allowing new internet businesses to emerge. At the same time investment finance is pouring into start ups who never quite make it to middle-sized companies because the successful ones, like WhatsApp and Instagram, get acquired by the big boys if they look like they might become a threat. In this new world, the rich still get richer.

However, there are signs that they are also moving to a more enlightened motivation, focusing less on maximising shareholder value and more on customer value. This is the basis of the new digital companies: put customers first and through that deliver for the business owners. Indeed, for the new form of platform businesses, their very business model is dependent on it. Robin Chase, the founder of ZipCar, explains it clearly in her book Peers Inc. An abundance is identified, like spare rooms in our houses, the platform then takes care of complicated things like payment and insurance, and then connects people with spare rooms to those who want to use them. Airbnb now dwarfs even the largest hotel chain, but has 800 employees compared with Hilton’s 152,000.

Chase predicts that this will be the dominant business model of the future, in a new collaborative economy. The Government Digital Service is actively pursuing the vision of government as a platform.

This sharing economy is characterised by powerful platform businesses empowering individuals to use their spare assets. It is more environmentally efficient and enables top up sources of income, but creates few jobs. It offers little for those with few assets – either physical or human skill – to share.

It seems that business in the digital economy has both become more unequal whilst being more customer focused. What does this mean for people?

As capital became more mobile with the globalisation of the 80s, so labour is doing the same. Work is no longer just a job, but a set of jobs. The growth of the ‘gig economy’ has created new opportunity and new uncertainty. It is possible to register as an Uber driver and rent a Zipcar by the hour to earn top up cash – until Uber’s investment in driverless cars removes that new source of income.

The numbers of freelancers in the gig economy is growing and disrupting jobs in new sectors. At the same time technology is hollowing out the labour market to replace jobs of brain as well as brawn. As John Hagel writes:

“Robotics is increasingly making inroads into manual labor while artificial intelligence and deep learning technologies are targeting a growing array of white collar, ‘knowledge worker’ jobs.”

Not everyone agrees that the dystopian future of technology stealing our jobs will come true. As Rick Wartzman points out there is a credible argument that a more utopian future awaits as long as we can match the demand with the supply of skills. This would necessitate a transformation of our whole education system.

England has a moderately good school system and some of the best universities in the world. The school system is designed around the needs of our elite academic institutions, with the assumption that the best possible preparation for a successful career is a good degree from one of our great research based universities.

This assumption is increasingly false. The unwritten contract when I was at school said that if you work hard at school you will get in to a good university, get a good degree, then a job for life. That job would allow you to live comfortably, buy your own house and contribute to a final salary pension that would allow you to live in secure retirement until your likely demise aged about 75. Current levels of graduate debt and unemployment, high house prices, the abandonment of final salary pensions, and now life expectancies well beyond 80, have exploded that contract.

The prospect of life to 100, in a very different labour market of simultaneous jobs and multiple careers, demands a very different education system. Why would you spend your investment in higher education all in your early 20s if you are working to 80? Why would you specialise in one academic discipline when employers value how you connect a breadth of knowledge creatively rather than just your depth of knowledge?

We need a different school system. The basis of a great school will remain great teachers and supportive parents. But I think that the content of learning needs to change, especially after the age of 14.

For children up to around 14 we should have a curriculum and seek to embed some core skills and a framework of knowledge. Core skills would be reading, writing, mathematics, coding, collaborating, and emotional expression. A framework of knowledge gives a context to reference online knowledge against, to build resilience, to allow the filtering of online nonsense and to differentiate truth from opinion.

But post-14 schooling should be much more research based, collaborative, knowledge making, and self directed; it should be relating to real world challenges and collaborating with those outside education. This better equips learners for what they need in adulthood, whatever direction they choose. For those born into families with few physical assets for the sharing economy, we should at least give them the chance of social mobility by ensuring they can keep up with the skills demanded in the economy.

The new digital economy is throwing up new inequalities.  There are still 10 million people in the UK without the skills and confidence to transact online, and yet you can’t apply for work or benefits without those skills.

Beyond that starting point there is plenty for a refocussed modern progressive left to focus on.

In a world of mushrooming nano-sized businesses, selfemployment and freelancers, what next for rights at work and job security? Do we need a new employment status for freelancers?

Trade unions are at risk of disruption from the online guilds identified by former US labour secretary Robert Reich. Co-Worker – an online workplace campaigns platform – is now having huge traction in Walmart, the world’s largest company.  The pincer movement of government attacks and new ways of peer-to-peer collective action create urgency around trade union modernisation.

If we accept a 50, and then 60, year working life, can we develop new longer-term mortgages to improve housing affordability? Should we base our fiscal projections of the cost of an ageing society on maintaining an affordable gap between life expectancy and retirement?

The heart of this conundrum, however, is whether there will be enough work.

Work may be a mix of jobs and sharing. There is no shortage of things to do – care, climate change, leisure, education – all big challenges creating work if we can find the economic model to fund them. Rather than eroding the NHS we should keep innovating and investing so that we are healthier workers, and taxpayers, for longer.

There are signs that around the world the left is waking up to this century’s challenges and new politics. The Changing Work Centre – a new project launched by the Fabians and the Community union – can lead the change in the left here in the UK. And I was encouraged last year to meet Grant Robertson MP, New Zealand’s shadow chancellor, who is leading a Future of Work Commission for the New Zealand Labour party.

These new initiatives must be honest about the problems and recognise we don’t have all the answers. They must forge a new collaborative politics and be honest that some vested interests need to change. Then we can re-model the Labour movement and be relevant once again to people’s struggle.