The real debate in the “sharing economy”

By Simon Moss, Business Development Director

We all know how companies such as Uber and TaskRabbit are digital disrupters — and they are to be applauded for taking traditional industries, blending them with digital technology and creating a completely new segment to the market.

This “sharing economy” — where services are effectively rented by one person from another — is hugely exciting. Airbnb, for example, is dominating the hotel market despite not owning a single building. Similarly, Uber is shaking up the taxi industry, but doesn’t own any cars.

The downside, as many are predicting, will be felt by the Treasury. Now that these disruptive companies are established, where they fit into the wider economics has posed a problem — and it is only going to get worse.

A labour force that is increasingly digital blurs the lines between traditional working relationships, denying the state much-needed revenue as we continue our economic recovery. While there will be many that are quick to brush this off (the government doesn’t need to take any more of our money) it is important to remember that a (relatively) strong labour market saw us negotiate the recession without the considerable job losses felt in Spain, for example.

But let’s move on from the worries of the Exchequer. Employment laws will become an even more confusing spaghetti of systems. While flexibility and choice are to be commended, protection from unforeseen circumstances, such as ill health, will be lost.

Disruptive technologies will make the news — and rightly so. But it is fast becoming time that we move away from being impressed at what the sharing economy can do, and focus on what is actually going to be done to make it a part of the broader picture. That is the next great debate.

It is a similar case with the Internet of Things, which is probably a few years ahead of the sharing economy, but nonetheless has many of the same core issues. Now that the wow factor of an internet-connected toaster has faded (spoiler, they’ve had some form of software in them for decades) the debate must shift to how these technologies will integrate into the wider fabric of business.

It is a fascinating challenge and one that is relevant to many Whiteoaks’ clients. Debate, opinions and strong voices are crucial to any PR campaign and we look forward to being at the forefront of these stories in the years to come.