The Labour MP for Dudley North on the progressive case for the sharing economy.
You’ve got to sympathise with the taxi drivers. Three years learning the Knowledge. Week after week studying hundreds of routes and thousands of streets. Months of museums and monuments, shops and theatres, hospitals, hotels and historic buildings across the city.
All that hard work guaranteed a job for life. And then GPS, SatNav and smartphones were used to invent Uber.
Two centuries ago, Lancashire textile workers smashed new spinning frames and looms that changed their industry and saved on labour. Later in the nineteenth century, the stage coaches which had delivered mail across England for 200 years vanished almost overnight as railways expanded across the country. A hundred years ago, the horse-drawn carriages that had transported passengers for over 200 years gave way to the first motorised cabs that gave birth to the London taxi trade.
I come from the Black Country and we know all about technological change putting traditional industries under pressure or out of business. Drive through Dudley and you’ll pass what was once the Round Oak steelworks. Bilston was dominated by the Stuart and Lloyds plant. Both provided well paid stable jobs for thousands. Down the road in Darlaston, Rubery Owen employed 17,000.
Round Oak is now a huge indoor shopping mall, office and cinema complex. Rubery Owen a distant memory.
The pits and potteries, steel and shipbuilding, textiles and other traditional industries all lost out to the challenge of technology or cheap foreign imports. Hotels are being challenged by AirBnB, newspapers by the internet, bookshops by Amazon and record shops by downloads.
It’s easy to say a protected monopoly is being opened up by new technology, but cabbies say they’ve lost a third of their work. They’re working longer and longer hours for the same money. Some are leaving the industry altogether. Few people think London’s cabbies will disappear like other industries, and new technology could help them, too; but the new competition is still a nightmare
George Galloway’s response to Uber is to promise he will “run them out of town” if he becomes mayor of London. Predictably, Nigel Farage blamed immigrants, complaining Uber drivers can’t speak English.
Populists the world over pretend they can shield people from technological change. But whether it’s Farage on the right, Galloway on the left, the SNP in Scotland, Le Pen in France, Syriza in Greece or Sanders and Trump in America, it’s just not true to tell people you can solve huge complex problems with easy, simple answers.
Millions are using Uber to get around every week. Over 1.5m Londoners regularly use the service – half a million more than voted for the winning candidate in the last mayoral election. Around 30,000 new people sign up to use it each week. It has already expanded to more than 15 cities across the country. One in ten Brummies used it in its first 12 months in the city.
Consumers like Uber. Unlike any other forms of transport, technology means the time, start, destination and route of each Uber journey is recorded in advance, along with the names of both the passenger and the driver. You can get a fare estimate without even making a phone call.
Uber drivers go through the same background checks as black cab drivers, but for the first time people getting a cab or car can get the name, registration number and a photo of their driver before they get in the car. The entire journey is recorded by GPS and they can share their route and arrival time with friends or family.
There’s no point pretending we can turn the clock back, and that new technology will go away, when the truth is that the pace of change will only become faster and faster. In time, the Uber driver will be overtaken by driverless cars.
The wheel turns
The challenge for progressives is how we can make sure everyone benefits from more competition, faster change and new technology that will expand choice and improve our lives.
We should be championing the potential for technology to put power back into the hands of workers. Uber allows people to be their own bosses and switch work on and off literally at the push of a button. They can work when and where they want, around other work, study or childcare.
In many ways Uber is the antidote to the worst aspects of the modern service economy like zero hours contracts, because the employee decides when and how much to work each week, rather than the employer. Surely we should be making it easier, not harder, to empower people and put them in charge of their work?
Uber say a third of its London drivers come from constituencies where unemployment is above 10 per cent. Thousands of new jobs are being created each month – often people who were previously unemployed or underemployed. In London, Uber says its drivers get an average of £16 an hour in fares after their commission.
Technology also means there are no “cash in hand” payments, so every Uber driver and every journey will have to be transparent, traceable and above board. It is still a relatively new business – it is expanding rapidly, but still making a loss. When it starts making profits, it should of course pay its fair share of tax like anyone else.
When you add the benefits of lower emissions from car sharing and the fact that Uber drivers can’t refuse to take you to areas that traditional taxis might not serve, it’s hard to understand how progressives could fail to back the service.
When money, jobs, businesses and whole industries could be moved right around the world, it has been Britain’s poorest communities that have paid the highest price for the benefits of globalisation. But now technology is threatening highly-skilled and well-paid workers too.
Faced with this huge transformation, we could, like Galloway or Farage pretend we can stop the clock – but in the end, however unsettling these changes are, people know it’s not true. Instead, we’ve got to answer these fears by equipping people with the skills they need to meet the challenge of rapid technological change.
Huge growth in hi-tech industries like advanced manufacturing, low carbon, healthcare and bio-medical technologies or digital media will generate millions of well-paid jobs, but we’ve got to ensure Britain has the skills to get them and that they can transform the lives of people globalisation has so far passed by.
The Tories’ hands-off, laissez-faire approach would just leave new technology and the wealth it produces in the hands of the elite. The hard left’s “stop the world, I want to get off” denial would have exactly the same result.
Instead of moaning about the change technology brings, or simply leaving it to the market, Labour must show how we can get businesses, universities, government and local councils working together to exploit new technology and bring new industries and new jobs to areas that have been left behind.
And our response to the rise in self-employment should be to improve the statutory protection they get from the state.
Let’s set some big ambitions for Britain. Why can’t we be the country with the biggest increase in educational standards and skills in the world? Let’s bring science, innovation and technology training to every community and coding to every classroom.
Let’s show how we can adopt new ideas, exploit new technologies but equip all our people with the tools they need to respond to these changes and benefit from the prosperity they will deliver.
And let’s pledge that as our economy grows, no community will be left behind this time – because we’ll use new technology to build a more prosperous country and open up opportunities for all our people and all our communities.
Ian Austin is the Labour MP for Dudley North in the West Midlands.
This article was originally published on our sister site, the Staggers.