This year sees the 25th anniversary of the world wide web, and now more than ever understanding its impact on our economy and society will be fundamental to any party with aspirations to govern.
The internet is changing employment radically. Economists and futurists in the both the UK and US predict that the nature of work is beginning to shift, with a massive two-thirds of jobs at ‘high’ or ‘medium’ risk of computerisation. Service jobs and retail sales are expected to peak by the end of the decade as automation takes over, while the demand for jobs with IT and programming skills is growing at twice the rate of other employment. In a new book Andrew McAfee and Erik Brynjolfsson argue that we are entering the ‘Second Machine Age’ with social and economic consequences analogous to the first Industrial Revolution.
If policymakers are to help avoid disruption of a far greater magnitude than that of the recession, we must now focus on the job-creating industries of the future. Those industries which will thrive rely on skills that computers and robot won’t be able to do. This means a fresh policy approach to the creative and digital economy.
Skills will be fundamental – as Jonathan Todd has argued before – so it’s welcome that the independent Philbin review is starting work on how we can ensure that people have the access to the right skills.
The regeneration of cities outside London and ensuring their competitiveness relies on a thriving creative economy. The authoritative Centre for Cities’ study not only illustrates the growing disparity between London and the rest of the country, but it shows that London, Bristol and Brighton are attractors for people with the skills new industries demand. While London dominates, those cities with a brighter future – Manchester, Leeds, Cambridge, Reading, Bristol – have already started nurturing their creative economy.
Then there’s the question of international competiveness. As Martha Lane Fox argued in her recent Lords debate Britain is a hotbed of invention but often doesn’t capitalise on its own success –ingenuity is invariably bought by international ‘Big Tech’ companies, rather than home-grown ones.
For Labour there’s also a current political question – the creative digital economy has established itself in London and the south-east. It is now home to tech firms, digital creative industries, research and pharmaceuticals (‘Med City’) accompanied by significant amounts of foreign direct investment. Understanding the drivers for the creative economy here – how to foster start-ups, create the right incentives, tech infrastructure and relationship to public services – will be increasingly vital to connect with voters dependent on these industries and their supply chains.
Put another way, if Labour doesn’t acknowledge these new dynamics, don’t be surprised if people think you are out of touch or behind the times on the economy.
The conventional wisdom in the tech sector, nurtured by the Conservatives since before 2010, is that ‘Labour doesn’t get tech’. Seizing where New Labour left off, the Conservatives have developed a range of initiatives to champion science and technology, framing their narrative in the context of the ‘Global Race’ for competitiveness and ‘Tech City’.
Where Conservative policy perhaps misses out is its aversion to industrial strategy – a point made very well by Iain Wright here. Rather than keeping the state out of the way and leaving it to the market or piecemeal initiatives, Labour should take a long-term view on these changes, focusing not just on today’s entrepreneurs but on the growth of entrepreneurialism.
So where do we start? NESTA’s Manifesto for the Creative Economy published last year sets out 10 recommendations – from intellectual property through to research and development and skills, which should be investigated in further depth. Labour’s welcome new Woodward review on the creative and digital economy should seek develop an active industrial strategy for the creative economy looking at comparative regulation, skills and tech IP. This should recognise that clusters of growth can and are developing across the country – not just in Tech City in the East End of London or in the south-east – and the ingredients needed to make them work – and miminise downsides with social cost – also include intelligent state levers from a government which understands the creative economy.
Theo Blackwell works in the video games industry, is a councillor in the London borough of Camden and is on the board of @labourdigital, a group of Labour supporters working in digital policy. He tweets @CamdenTheo
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