Economic growth: inclusive, green, no-cost.

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Modern Markets for All thinking dates from 1994; before Google, Facebook, even eBay. Making it real involved missteps, setbacks and compromises, but a lot of actionable learning.

 

 

Contrarian, but not theoretical

The notion that governments initiate a system of online markets as a regulated public utility originally seemed obvious. Policymakers always ensure significant new technologies deliver maximized economic growth if the private sector can’t. But a 1997 book by UK journalist Wingham Rowan outlining the possibilities and his second book in 1999, published internationally, were contrarian to the point of irrelevance.

Rowan’s titles were quickly sidelined in stores by books like Dow 36,000 then Dow 40,000 and finally Dow 100,000. These authors were off in their projections about the Dow Jones Index. It hasn’t reached even 30,000 since. But their bedrock assumption – that corporates would be left to drive the emerging internet, raking in huge profits – was spot-on.

There is an Overton Window of policy ideas considered acceptable at any time. Modern Markets for All was outside it. So, attention turned to one aspect of the vision; problems of low-skilled individuals needing work that fits around day-today fluctuations in their medical issues, family caregiving, studying, existing partial employment or parenting. Public agencies support job seekers in all sorts of ways, including online platforms offering an alternative to commercial job boards. Why not extend services to irregulars with empowering new markets for hourly labor?

We developed the technology, worked with public agencies, politicians, think tanks, technologists, business leaders, umbrella bodies, unions and educators around Europe and the US. Our learning was open sourced, and we oversaw fledgling market operations on two continents.

 

This learning unfolded over four phases:

 

PHASE 1: Expounding (1994-2000)

Unlike past campaigns to turn new technology into public infrastructure, “Modern Markets for All” has its roots in a TV show about online sex. British journalist Wingham Rowan was producer/anchor of “cyber.cafe” which, starting in 1995 used its late night slot to explore how foot fetishists, exhibitionists, “adult babies”, alien abductees and other marginal groups were exploiting the emerging internet.

Being part of that emerging explosion of online activity led to off-duty thinking about the Internet’s potential to bring individuals in from the economic fringes. And how governments could easily accelerate that. Articles, books and policy papers followed.

London think tank Demos and its then leader Geoff Mulgan organized experts to scrutinize the possibilities of “Public Benefit Computer Trading” from 1994. That culminated in a 1997 book: Guaranteed Electronic Markets: Backbone of a 21st Century Economy?  Support then came from Charles Handy, Britain’s leading futurist. That led to a 1999 book published internationally: Net Benefit: Guaranteed Electronic Markets, the Ultimate Potential of Online Trade. These titles foresaw the “sharing economy” and its coming limitations.

Prime Minister Tony Blair’s report defining UK digital policy featured a box about this thinking on page 94.Press coverage was generally kind, occasionally baffled. The concept of governments using their leverage to catalyze new markets made it onto the BBC World Service, Radio 4, The Times, The Independent and a 2 page spread by Handy in The Guardian. In the US there was an hour long phone in on National Public Radio, coverage in technology magazines and multiple “think pieces”.

 

 

PHASE 2: Failed builds (2000-2002)

A dot.com incubator, then consulting giant PricewaterhouseCoopers saw commercial potential in the markets described in Rowan’s books. Adecco, the world’s biggest staffing agency and Informix, now part of IBM, joined his company to make the markets a reality.

But the complex technologies required under-the-hood couldn’t be made to work at the scale required at that time. After two failed software builds, the company was disbanded. Interest in the non-commercial route continued from think tanks on the right and left. But it was infinitesimal compared to attention paid to the dot.com boom then bust.

 

 

PHASE 3: 20 City launches (2005-2013)

Rowan spent 2002-2005 working with a volunteer technologist to re-scope the technologies required for these markets. Turned into interlinked PowerPoints, they were then tested on a spectrum of potential users.

That exercise culminated in a £500,000 award from Britain’s Office of the Deputy Prime Minister, to rebuild. Focus was on using new markets to ensure people needing work to fit around ever-changing medical issues, care-giving, parenting needs, studying or home business commitments had the best possible work opportunities. That tech. finally worked.

The UK’s Department of Health and Cabinet Office provided further funding. But Department of Work & Pensions (DWP), the UK labor ministry opposed the initiative. They argued government should focus solely on job creation, not bits of employment. Internal papers, obtained through the Freedom of Information Act, also revealed officials worried their floundering IT systems couldn’t interface with the new irregular work platform.

 

Despite DWP making clear they wanted the initiative stopped, 20 city governments launched a market. It was unexpected, Britain has unusually centralized government even by European standards. But, opposed by DWP, these were timorous launches on a small scale. We progressively learned you can’t launch such sophisticated markets incrementally. There needs to be a critical mass of demand on day one. (This counter-intuitive point is explained in our recent manual for US public agencies.)

Tesco, a supermarket and Britain’s biggest private sector employer, decided to join the program but eventually opted only for a closed system; available to their staff alone. That created further siloed, small-scale, implementations.

By end 2010, regime change at DWP allowed a case to be made for a top-down approach to launch. New ministers went on front pages to announce these markets were to become a key part of the “Universal Credit”; a bold plan to replace Britain’s byzantine welfare system with one credit. As planning for a merged platform began, the faltering individual city markets were wound down. At the same time Zero-hour contracts were becoming an increasing issue for UK workers.

But the Universal Credit turned into a spectacular failure even by the standards of government IT schemes. The overarching program is now five times over budget and many years behind schedule. Non-core services like ours were jettisoned as public employment agencies around the UK became paralyzed. In parallel, Rowan’s operation made some mistakes and began to wind down. But it was clear no other country had created markets like this. A copy of the core technology was put in a non-profit for open sourcing elsewhere. Key personnel transferred.

 

 

PHASE 4: Stateside (2016-present)

Advice from British consulates led to the US. Their Public Workforce System is ideally placed to catalyse the stakeholders required for launch of markets we call a CEDAH (Central Database of Available Hours). Nothing comparable was on their horizon. A British philanthropist provided seed funding for exploration.

US Dept. of Labor, Aspen Institute, Living Cities, National Governor’s Association, National Association of State Workforce Agencies, National Association of Workforce Boards and Governing magazine promoted these markets to US workforce boards.

By July 2017, 25 workforce bodies (national, state and large-city) had collaborated on a report funded by Annie Casey Foundation. It explored the significant potential, and challenges, of launches in the US. A key issue; federal funding for workforce boards can only be used to support traditional job-creation, not non-standard employment.

In fall 2017, the 7 workforce boards of Los Angeles County signed off on an open letter to philanthropies saying they wanted to take the lead in preparing for US launches. Kauffman Foundation and Wells Fargo Foundation resourced a market testing team.

The project won US Conference of Mayors’ award for best job/economic development initiative in the US. That drove heightened interest around the country. In September 2019, a CEDAH for Los Angeles County was quietly launched with supportive employers. Meanwhile, “gig work” has become an inflammatory issue across California with the passing of Assembly Bill AB5 which aims to tackle misclassification, one of the problems, faced by some of the people, trapped in irregular work.

 

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