The Sharing Economy - The Hidden Trade Offs.
Margarete McGrath
Global Advisory Lead @ Dell Technologies | Tech Ecosystems, Cybersecurity, Partnerships
Good Governance and digtial ethics is certainly being raised more in the past twleve months than ever before. As our clients as they expand their digital offerings, we are seeing significant interest in the development of new business models including the emergence of new business ventures and innovation units across traditional structures. The focus on user design and innovation is being spurred on by the success of disruptors such as Airbnb and Uber.
The Sharing Economy offer many upsides for consumers, one segment of our society who are embracing the new wave of on demand services is our mature workforce, those in their early stages of retirement. According to the World Health Organisation, those aged 65+ will, for the first time in history outnumber those under the age of five. The Sharing Economy offers real opportunities for many retirees. Recent research completed by Emergent and Intuit indicate that 18% of sharing economy workers are 55+. This research concludes that the number of older Americans seeking sharing economy work will likely continue to grow.
Some of the main reasons why the Sharing Economy is so attractive to our mature workforce are due to the following:
Digital Seniors – many of our mature seniors are digitally advanced with access to high speed broadband and smart phones. My mother for example, can navigate on demand mobile platforms faster than using some public services.
Flexibility – on demand services are based on flexible work arrangements. Many retirees are not are not ready to commit to full time retirement either. On demand working offers the best of both working and retirement mode to fit their lifestyle.
Supplemental Income – given recent pension deficits particularly in Europe, supplemental income is welcome by may retirees. Airbnb or DogVacy offer real alternatives by renting out a spare room or providing a dog walking service through DogVacay.
Social engagement - many of our mature workforce are not fully ready to embrace a slower pace of life. Workplaces offer real forms of social interaction and stimulation either with colleagues or with customers. On demand services are focussed on user experience and creating a personal connection particularly in the case of Airbnb.
There are many hidden upsides to the further development of the sharing economy. More businesses are striving to consider how to pivot and innovate their business models. It is important that we highlight the silent risks that need to be addressed to ensure sustainable growth. All segments of society should benefit from sharing models and not just an elite few . We believe that there are trade-off's which needs to be surfaced.
We have identified a number of areas that need to be carefully considered by Government, Regulators and On Demand Businesses. So far, the market is relatively self-regulated due to the instant ratings channels.
The Future Workforce - Contingent Labour Models
An area that needs to be explored is the future role of labour and the protection of contingent workers particularly those that are vulnerable e.g. in some instances our mature workforce. There is a trade off between convenience and workers rights which needs to be surfaced to enable consumers to make an informed choice.
Data Compliance
We need to consider data compliance and usage. Ethical use of consumer data and the management of this data needs to be addressed so as to ensure that consumers do not volunteer excessive levels of personal data to sign up for a service. Consumers need to be clear on how their data will be used and what the supporting terms and conditions mean as part of a data request.
Oversight & Regulation
Oversight and regulation of algorithms to include user feedback rating and independent monitoring to ensure the ratings are independent and objective . This is critical to ensure that we continue to build on digital trust levels which underpin the foundation of the on demand economy.We also need to consider how local taxation and planning can be kept up to date to in each geography.
Emerging Technology
Finally, the future proofing and development of new payment options, emerging technology such as blockchain, robotics and augmented reality so that on demand services can continue to innovate and evolve.
All of the above elements need to be considered to ensure sustainable growth of on demand models. Sharing models are continuing to grow at a significant rate across many sectors such as transport, hospitality, peer to peer lending, peer to peer exchange of digital content such as music, art and print media. We expect to see further growth in new areas such as grocery, industrial equipment, industrial /office space, maritime and airline travel. New models will continue to emerge in the most unlikely of sectors and therefore, real consideration needs to be given as to how we can ensure a sustainable growth path and continued levels of digital trust.
If you are interested in developing a new on demand venture as part of a traditional business model and /or are interested in exploring how the Good Governance and Digtial Ethics you, please connect with us.
I love this video about the shared economy.Brings to life some of the comments you have https://www.youtube.com/watch?v=32NlrmJs5kw
Great read Margarete and such a pertinent time in Ireland for the new Government to decide how they want to embrace the benefits that the sharing economy can offer its citizens
Global Advisory Lead @ Dell Technologies | Tech Ecosystems, Cybersecurity, Partnerships
8 年Great insights and additions Ross McCarthy
MD Keystone Procurement, Vice President SMEUnited, Board & National Council Irish SME Association (ISME). ISME Chair 2019-2021. Consultant, advisor & public speaker on procurement, trade & business policy.
8 年It's a very worthwhile initiative Margarete. I spent a good bit of time last year meeting with people discussing this whole area. There are a couple of elements not picked up on in your post that underpin the economic model that affords optional involvement in sharing economy / gig economy employment by senior citizens (I am not talking about people that cannot afford to retire). One is the post-war generation have pension provisions that will not be in place for the vast majority of sub-45 yr olds across the developed world and in many cases are not heavily geared (assuming they avoided the property boom punch bowl). In fact, in many cases state pensions are not funded at all so an income famine awaits sub-45s relative to senior citizens choosing to dip in and out of roles now as a lifestyle choice. The second is the cannibalising impact of both minimum wage legislation and the "flexibility" of senior citizen employment on youth labour engagement. We have record levels of youth unemployment and these levels have steadily progressed in line with the widespread roll-out of market interventions that have compromised the kind of labour differentiation that prevailed up to the mid-90s. This creates an artificial bottom to the market (often conflating unskilled and semi-skilled roles). In examining the role of basic income and unitary rates of taxation to stimulate labour demand, I became convinced of the necessity to eliminate the minimum wage in favour of graduated basic income. This would establish a threshold of dignity below which nobody could fall but would not eliminate the need to work. The failure to tackle youth unemployment will have a catastrophic impact on private wealth in the future as too many spend too long in an wealthless vortex - again pension provision is a major issue here because they cannot afford to provide. The final point I'll make is that vested interests will (in time) seek to impose crushing levels of regulation on sharing economy style disruptors. They just take time to do so - witness the current civil service advice on the expansion of Uber in Ireland. Great work, I look forward to tracking this.