The digital economy is a topic that seems to have a universal appeal among British politicians. Recent House of Lords Select Committee report on digital economy highlighted that failing to take advantage of the opportunities for future prosperity presented by the digital sector is a risk.
Why, then, does the election campaign give such little attention to the digital economy when it is so important for the future?
The committee suggested increasing broadband speeds and improving internet access. It is difficult to determine the exact approach of the political parties to the digital economic until their manifestos are released. Looking back at the 2010 election campaign, Labour, Conservatives, and Liberal Democrats were all in agreement that building physical broadband infrastructure should be the top priority. This is not a controversial issue.
Not only skills, but also abilities
Other aspects of the report are controversial. The committee made a number of recommendations for implementing a near-universal program of digital skills training, even though many experts testifying before the committee said that literacy and numeracy are more important. The rapid development of computer hardware and software means that certain technical skills may quickly become outdated. Cognitive skills that help adapt to rapid changes are more beneficial in the digital world.
The committee only dealt with a superficial aspect of the issue. The committee acknowledged that automation could lead to the loss of up to 35% jobs, but argued that this would only be for low-skilled positions.
This is a suggestion that the loss of jobs will be offset by more high-level positions in the knowledge economy. These higher-level positions are likely to be filled by workers who have developed their digital skills through the training programs. As Silicon Valley entrepreneur Martin Ford argues, the jobs of knowledge workers are at least as vulnerable to computerization as those of other workers.
Three parties, no answers
What are the positions of the major parties on these issues? On March 27, the independent review by the Labour Party of the impact of the digital economy on creative industries in the country released its report. The report is not a significant departure from current government policies, especially in terms of UK copyright laws and intellectual property.
There is a recognition that the digital economy has some negative social effects. This includes recommendations to increase women’s participation in digital creative industries and to give new powers for tackling online monopolies, which are a trend in certain digital markets. This is not the official Labour Party policy, but it provides a good idea of what policy would be under a Labour Government.
The digital economy, however, is a topic that Westminster has largely ignored. Crown Copyright/BBC
Two ministers of state, Ed Vaizey and Nick Boles, provided evidence to the Lord’s Review on the Conservatives’ digital economy approach. The ministers stressed the importance of skill-based training. Much of it could be done by the private sector. The need for more women to study science, technology, and engineering at university was also stressed. The Conservatives’ approach to the digital economy is a tension between their promotion of free-market economics and their desire for government intervention to ensure domestic safety. Consider the huge criticism that David Cameron received from the tech industry for his misguided suggestion to “banning encrypted”.
The complete picture
commented on the recent Leaders’ Debate that it’s wise to emphasize the huge growth potential of the digital economy in the face of political ambivalence. It is important to also address the social and political implications of a digital economy. The mountains of electronic waste from devices that are quickly rendered obsolete and the environmental impact on huge datacentres, which power the internet economy, are just two examples. A written submission on the environmental impact of the digital economy was ignored.
The report fails to address sexism, which is prevalent in the tech industry as well as online communities. A little more sophistication is needed to deal with the underrepresentation women face in these industries than just urging them to pursue science and engineering. In digital industries, the tendency to “winner-take-all” is a problem. The best product will win in a global market that is instantly accessible online.
The report of the committee suggested that a more comprehensive and all-encompassing strategy is needed to maximize the benefits and minimize the potential downsides of the digital economy. It should also include the arts, humanities and technology sectors. This is not a mere footnote in a narrow agenda based on skills. To date, neither party has given the slightest indication that they are up to the challenge.