The ‘platform economy’ is changing all of our lives as consumers, as demonstrated by the runaway success of platform businesses such as Airbnb and Uber. But such a radical change also has profound implications for many of us as workers – with insecurity and lack of protection all-too-present dangers. The impact is only set to grow as platform working pushes into yet more sectors. This provides progressives with a real dilemma – do we try and stand in the way of such a dynamic and growing part of the economy or can we adapt the models of social protection we hold so dear to the new reality?
Analytically, we must be careful not to confuse the concept of “sharing economy” or “platform economy” with the underlying trends in labour markets, namely increasing polarisation and the transformation into knowledge economies. First, the employment structure in European job markets is undergoing severe polarisation. A two-tier job market results in parts caused of new technologies but also increased labour market flexibility, especially in southern Europe. Second, this takes place at a time when our economies rely on a larger workforce with intellectual capabilities rather than physical inputs or natural resources.
Both of these major shifts are taking place at a time when the importance of the internet becomes a key factor in the growth and productivity increases in developed economies. As relatively new phenomena platforms facilitate market transactions between workers and consumers. They seek a ride on Uber, want to have a pizza delivered by a Deliveroo cyclist or rent out their apartment to a tourist. For policymakers the main challenge is how to reform industrial age labour regulation and social policies so that they do not stifle innovation but allow fair competition in modern economies.
Across Europe the centre-left, both in government and in opposition, has only taken faltering steps so far to try and keep up with the rapidly evolving pace of change from emerging tech. Too often, uncertainty over how to respond is resulting in inaction and lost opportunity. They must bring the “future of work” to the forefront of politics because it is one of the natural habitats of the left. While conservatives and rightwing populists offer easy solutions to complex scenarios, either protecting vested interests or deregulating industries, the centre left must claim thought leadership on providing individuals with strong safety nets and empowering tools in a new work environment. This includes debating 21st century labour and employment laws, the role of social partnerships and trade unions, the responsibility or private actors in re-skilling and re-training workers and labour market activation programmes.
Florian will also be discussing Sharing economy in Kalevi Sorsa Foundations Seminar on Urban Perspectives in Helsinki on 15 November 2016. You are welcome to join us! Program here
Florian Ranft, PhD, is a policy researcher in Policy Network, London. He focuses on European politics and the political economy, including the balance of economic growth, labour markets, financial stability, social justice and digital economy. Previously, he has researched and lectured in political sociology and international relations at the University of Frankfurt and the University of Greifswald.
Kalevi Sorsa Foundation recently published an article in Finnish on new forms of work by Helsinki University professor Juha Siltala, which can be accessed here.