The sharing economy could be transformational for the UK. So why are we lagging behind?

A new report describes a number of ways local governments in North America have implemented sharing economy programmes. what can the UK learn?

Guest post by Alexander Hardiman

The autumn spending review announced 56% cuts to the local government grant. Alongside the heavy cuts local government faced over the last parliament, this will put services under severe pressure. Greater integration of the sharing economy could have a transformative effect.

64% of adults in the UK participate in the sharing economy, which involves the ‘bartering, sharing, renting, trading, borrowing, lending, leasing and swapping’ of ‘goods, services, time, capital, experiences and space’. The global sharing economy is predicted to be worth $335 billion by 2025, and its ability to extract value from pre-existing assets could provide savings of a trillion dollars p/a. With approximately $3.5 trillion of idle resources in the world, imaginative integration of sharing economy projects could ease the burden of local government cuts.

One Earth’s recent report Local Governments and the Sharing Economy describes a number of ways local governments in North America have implemented sharing economy programmes. These range from direct funding to facilitative roles promoting events, offering expertise and lending assets.

The report suggests sharing economy initiatives around the world that local governments could replicate to drive value, efficiency and sustainability. Local government could particularly benefit from three sectors: shared assets, space and mobility.

Shared assets programmes could ease the pressure on waste budgets. Shared space initiatives could provide affordable housing and support the surge in self-employment. Shared mobility could tackle the questions of sustainability associated with car ownership and commuting.

A particularly compelling asset sharing project is Europe’s National Industrial Symbiosis Programme, where businesses share and reuse by-products. In 8 years NISP has saved £1 billion in costs, created £993 million extra sales, reused 38 million tonnes of waste and safeguarded 10,000 jobs.

Denmark’s Kalundborg Eco-Industrial Park operates on similar principles; steam from the power plant heats local homes, ash waste makes wallboard and slurry is used as fertilizer and pig food. Local government could take inspiration from these examples and encourage symbiosis initiatives between local businesses in response to waste budget cuts.

The shared space sector includes coworking spaces and cooperative housing. Coworking lets people work in a more productive environment, forges new business connections and boosts entrepreneurship. Gangplank is a coworking space which operates as an incubator for tech start-ups and community centre. Users of Gangplank’s wifi pay in social capital, by mentoring or volunteering at events. It uses publicly-owned space rent-free, and in return provides consulting, charitable donations and community services.

By contrast the UK’s assets are poorly recorded. TfL owns 5,700 acres of land with no record of its usage. The report recommends local government creates ‘an inventory of civic assets’ and ‘underutilized assets [should] be valued, inventoried and offered for use’. In doing so, local government should prioritise initiatives bringing value or social capital. Encouraging coworking spaces would help support the self-employment revolution and reduce unproductive commuting. It also gives people the power to club together and purchase as a group; Coworking Ontario offers members discounted health insurance.

Housing co-operatives could offer a partial answer to the housing crisis by providing stable accommodation for a fixed fee. They’re cheaper and sustainable. A few adults living together use 23-77% less electricity and 38-54% less gas. Local government can encourage co-operative forms of housing by publicising its benefits and encouraging complementary schemes, like carpooling to ensure good transport links.

Shared mobility ventures like Uber can increase women’s participation in the night-time economy, prevent drink-driving and reduce the number of cars on the road, yet have tended to have a confrontational relationship with cities. A collaborative relationship could benefit both parties.

The sharing economy is currently overwhelmingly dominated by the affluent. The typical user earns over $60,000 in the UK and $100,000 in the US, and low-income people make up a small proportion of users. Despite this, the sharing economy has a three times greater impact on low-income communities.

If some of the barriers preventing disadvantaged groups participating – like the need for a credit card, smartphone, or driver’s license – could be overcome then this could be even greater. Integrated into the fabric of local society, the sharing economy could relieve the demand on services, provide equitable access to assets and foster more connected communities.

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3 Responses to “The sharing economy could be transformational for the UK. So why are we lagging behind?”

  1. AB

    “The sharing economy is currently overwhelmingly dominated by the affluent. The typical user earns over $60,000 in the UK and $100,000 in the US, and low-income people make up a small proportion of users. Despite this, the sharing economy has a three times greater impact on low-income communities.”

    Perhaps this is because the affluent, or at least those who are affluent other than through inheritance, might tend to have skills which are more in demand and valued more highly than those who are “disadvantaged”. If you’re say, an accountant, and you want to barter your skills by offering to do tradesmen’s tax return in return for the tradesman doing some work for you, it probably won’t be worth your while to do so on the basis of your time being worth the same as the tradesman’s. You could just do an extra hour of paid work and have enough to pay the tradesman for several hours work. Whereas, the tradesman could spend all weekend trying to make sense of a plastic bag full of unsorted receipts or get 15 hours of paid work and pay the accountant half of it. On that basis, the value to the tradesman of the accountant’s work in terms of the time it would take them is actually much more than what the accountant would charge in cash. So why would they bother to barter?

    But, at least the tradesman would have something the accountant might want and agreement could be reached. If you are someone with few skills, you are reliant on being able to persuade the accountant that you can make it worth their while to swap their skill for a large amount of your lack of it. But if you could do that, you could probably do better by providing that labour to an employer who’d pay you.

    The whole system would in reality rely on wealthy people deliberately undervaluing their time and expertise in order to provide disadvantaged people with things at a big discount. That’s charity, not a realistic parallel mass economic system.

  2. Brad JJ

    There is this thing called ”capacity” UK does not have it. No Boris Island airport (we do not have skills to do it); bringing in Chinese to build our power generation and completely screwing up every major computer system UK government embarks upon. The UK is half-way to the idiocracy.

  3. Intolerant_Liberal

    Only half way? I think they have achieved their plan. They are the biggest Bond villains of all!!! Posh boys, with hardly any talent or vision, other than being the bitches of the super wealthy and the corporations, screwing up everything for everyone else, and creating a super rich, super powerful elite answerable to nobody. Neo feudalist politics at its finest. Hurrah and double hurrah for the Bullingdon Boys…and all their forelock tugging toadies and sycophants.

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