Well the question of tax, and how much of the newer forms of income are identified is already an issue. Some trading on eBay will inevitably hit UK capital gains thresholds but not all by any means. Airbnb rentals are absolutely akin to historic house rentals but if the owner provides (and charges for) additional services like a guided tour of the locality, cooking demonstrations, language teaching – does this become more of a formal business? The lines of distinction between business / personal; capital/income; incidental / regular will become significantly harder to define if portfolio income takes off.
And that’s before the question of where this activity will take place. Digital nomads were, at least until Covid interrupted, becoming more common. As more of our lives become virtual the question of where an activity is genuinely taking place becomes greyer. If a 3D print design is created by someone in the UK, but only drives revenue when it is used to print the item in say, USA – how does that work?
And above all there is the shift in mindset needed here. If portfolio income becomes the norm, then so many of our fundamental assumptions about the relationship between work and income will need to shift – where, who, how, what time of day, how the income is defined . . . . the list is endless. And will the complexity of these arrangements be left to the individual to sort out? Or will government need to educate, enable, facilitate and support – if for no other reason than to ensure equality of opportunity?
I’m quite sure that isn’t a definite list – more the tip of the iceberg. And I think there are many more new opportunities to come. So watch this space!
My latest addition to changeisanopporunity is around the democratisation caused by digital technologies, using Nutmeg, an online investment management site which makes clear that anyone, even with small amounts of money can invest – and at costs which make it attractive to do so. This is achieved through the use of algorithms in this instance but it is just the tip of the iceberg – data and analytics (both descriptive and predictive), machine learning and automation are all contributing to this trend. And as sensors are increasingly embedded in everything we touch and use, the internet of things will make all of this even more feasible and cheaper. At one level therefore technology is a real driver of democratisation – opening up privileged areas to a much wider population, and making expertise transparent and accessible rather than scarce and expensive – in that sense this is another aspect of abundance from scarcity.
But does the democratisation solve all problems? Does everyone have both the access and the capability to use the technology needed? Does everyone understand the implications of engaging (not just investment management but whatever platform transactions they are joining)?And does the transparency over costs and the comparison with traditional routes provide a complete view of the opportunity here? And let’s not forget that investment management is by its nature regulated to protect those who may be vulnerable but not every industry where digital democratisation is occurring has the same levels of oversight. . .
So this democratisation brings with it ethical questions as to where responsibility for decisions rests – and the extent to which making something simple to do, and cheap to achieve is sufficient of itself – or does it bring additional responsibilities?
If my posts this week seem a little vague it is probably because my brain is full. I’ve just finished both Frederic Laloux’s Reinventing Organisations and Breaking Smart Session 1 by Venkatesh Rao. Both have so much food for thought in them and on the face of it, little in common per se. And yet, put together with much of what John Hagel talks about I think there is much serendipity in reading them in close proximity. So this is a brief post to bring these to your attention – more to come I suspect when my brain has done digesting . . . .
Last weekend I bought on impulse a beautiful hand embroidered quilt from Sophie Pattinson at the Stansted Garden Show – one of my favourite weekends of the year. Sophie clearly has many motives for what she does but one of them is the development of the craft skills of embroidery. Now craft is alive and well – Etsy is testament to that – but what about craftsmanship? The distinction to me is that crafts are about the production of product (or possibly a service) whereas craftsmanship is the development of the skills to do that – that’s a personal definition so please feel free to argue!
So why am I worrying about the distinction? Well it’s this debate – triggered by this research paper from the Oxford Martin School. There has been a lot of interest and discussion on employment more widely (about which more in a later post I suspect) but the issue of how technology impacts craftsmanship has not featured widely. And yet – much of the luxury market has traditionally depended on craftsmanship – couture, automotive (think Rolls Royce), Swiss watches . . . . it is a long list. And there is the fascinating question of whether new methods of manufacture, especially 3D printing require the development of craftsmanship to take the technique to its full potential . . . before we get to the intriguing question of whether intelligent systems are capable of craftsmanship without human intervention. Demand for the luxury market and craft products remains high but I am interested in the supply side. Do tech literate Millennials aspire to develop craftsmanship in old skills? When the present generation of craftsman retire will their skills die with them? Or will those skills be replaced by technology solutions in some form? And where does all of this overlap with design (for which technology is already huge)? I thought this was all a cerebral debate in my head, until I heard of a pre-school group running plasticine workshops for their new joiners – toddlers who had spent much time swiping on iPads and phones but who were failing to develop the necessary motor muscles in their hands because they were not gripping and pulling. I then realised that to date at least, making stuff has been an integral need for all of us – even if we don’t all become craftsmen.
The design question is what made me think about 3D printing and the wider Maker revolution. Clearly home made is not only a real possibility for many but an increasing reality. But is that the same as craftsmanship? Is the connectivity of the internet and the sharing of experiences and design today’s replacement for apprenticeships and long mentoring? Will immediate real-time discussion replace patient tutoring? Craftsmanship after all is not always about individualism but about expertise and quality coupled with the innate expert ability to overcome problems along the way – the wood that doesn’t quite do what you need it to, the old watch that needs repairing, the fabric which doesn’t drape quite right. Does this 3D printed fabric replace that need?
And what of intelligent manufacturing? What of the armies of Baxters and the equivalents? Can they learn craftsmanship and the skills that go with it? And if they do, are they then craftsbots? From a different perspective, if robots can paint artistically, could they become craftsmen?
I have so many questions about this – some really philosophical, some much more practical. From my own perspective I was happy to pay a premium for my quilt – partly to support Sophie and her groups in Bangladesh but even more for the beautiful craftsmanship displayed. I suspect that if AI or technology supersedes some of the tasks involved there will still be a premium payable for exquisite work – the danger in my mind is that we simply don’t have the people around the train a new generation – we want the craft but may not have the craftsmanship.