There seems to be a uniform impression among British politicians and legislators that the digital economy will radically transform the country for the better. A recent House of Lords select committee report on the digital economy highlighted the perils of failing to respond adequately to the opportunities it provides for future prosperity.
Why then, if the digital economy is so central to the future, is it being given so little attention during this election campaign?
The committee recommended increasing the speed and extent of broadband provision, and improving access to the internet. It’s difficult to discern the political parties’ precise approach to the digital economy until they launch their manifestos. However, looking back to the 2010 election campaign Labour, Conservatives and Liberal Democrats all agreed that developing physical broadband infrastructure was the main priority – this is not a contentious issue.
Skills, but not only skills
There are other aspects of the report that are contentious. The committee recommended extremely ambitious steps for near-universal provision of training in digital skills, despite many of the experts giving evidence to the committee arguing that basic literacy and numeracy were more important. Indeed, the speed with which computer hardware and software develops means that specific technical skills can quickly become obsolete – cognitive skills that support adapting to rapid change are arguably of more benefit in the digital economy.
There is a broader concern about the impact of automation on job security, something the committee dealt with only superficially. While acknowledging that up to 35% of jobs could disappear due to automation, it argued that these would be in low-skilled occupations.
The suggestion is that this potential loss of employment will be offset by more, higher-level jobs in the knowledge economy, no doubt filled by those workers who have honed their skills in the proposed digital skills training programmes to be offered. But, as author and Silicon Valley entrepreneur Martin Ford asserts, it is arguably knowledge workers whose jobs are as much at risk, if not primarily so, from computerisation.
Three parties, no answers
And where do the main parties stand on these issues? The Labour Party’s independent review of the impact of the digital economy on the nation’s creative industries released its report on March 27. It’s difficult to find within it any significant differences from the policies of the present government – particularly in respect of leaving unchanged UK copyright and intellectual property law.
But there is recognition of some of digital economy’s negative social effects, with recommendations to boost women’s representation in the digital creative industries, and new powers to tackle the online monopolies that are a tendency of some digital markets. While this does not represent official party policy, it’s a good indication of policy under a Labour government.
The Conservatives’ approach to the digital economy can be gleaned from the evidence provided by two ministers of state, Ed Vaizey and Nick Boles, to the Lords review. They emphasised the importance of skills-based training, much of which could be undertaken by the private sector. Also emphasised was the need to increase the number of people studying science, technology, engineering and maths at university – especially women. But the tension between the Conservatives’ promotion of free market economics and its desire for state intervention to ensure domestic security runs through the party’s approach to the digital economy. Look for example at the enormous criticism from across the tech sector of David Cameron’s wrong-headed suggestion of “banning encryption”.
The whole picture
It’s wise to highlight the great growth potential of the digital economy in the face of such political ambivalence, as per comments on the recent leaders’ debate. But the other political and social implications of an increasingly digital economy need to be addressed too. For example, the mountains of e-waste from electronic devices rendered quickly obsolete, and the environmental impact of huge datacentres that power an internet economy. Yet a written submission to the committee on the digital economy’s environmental footprint was simply ignored.
The report also fails to address the sexism that runs through much of the tech industry and is evident in online communities. Dealing with the under-representation of women in these industries requires a little more sophistication than simply urging more of them to study science and engineering subjects. The tendency towards a “winner takes all” outcome in digital industries – where in an online, instantly-global market the best product wins and little is left for others (Facebook’s dominance is the classic example) – also requires some creative thinking.
As the committee’s report suggested, a much more wide-ranging and all-encompassing approach is required in order to harness the benefits of the digital economy, and to predict and prevent its potential drawbacks. This should be an approach that draws on the perspectives of the technology, arts and humanities sectors too – not just a footnote to a narrow skills-based agenda. So far, none of the parties give the slightest impression of being up to the task.