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Brexit and The Future of Work


Brexit and The Future of Work

My head is pounding with the machinations surrounding all things Brexit. The whole thing really is what us Brits like to call...

6 Minutes Read

My head is pounding with the machinations surrounding all things Brexit. The whole thing really is what us Brits like to call a complete Horlicks. So bear with me, as I try to put the Brexit psycho-drama into a Future of Work perspective. Rest assured that I am not going to bang the drums for this deal/no deal/ or remain with the EU. What I would like to do is offer an opinion based on the research I’ve been doing to figure out Europe’s place as new jobs and new industries begin to scale.

Right now, I’m putting the finishing touches to a Center for the Future of Work study to map out where new, innovative forms of technology and work are catalyzing and coalescing across Europe. I wanted to put some heft into the idea and test the hypothesis that Europe is assembling the building blocks for a new economy based on platforms, algorithms, AI, etc. that would unlock GDP, raise productivity, and create thousands of new jobs. The study attempts to answer if Europe has the smarts on digital compared with the US or an emerging China. I’ve commissioned data, read everything I can lay my hands on, and have now built a heat-map of emerging capability for every single country. The result? It’s painfully and blindingly obvious the pivotal role the UK plays in shaping the tech innovation that drives the European continent forward.

Some facts for you. I see start-ups like good ideas as the lifeblood of the digital economy. The UK has the largest count of successful start-ups more than anywhere else in Europe. Moreover, London tops the region for deals done (start-up exits) and by some margin (start-ups in Paris raised about a quarter of what London pulled in for 2017 (even with Brexit triggered) and Berlin trails behind Paris). The UK is also the meet-up capital of Europe. Does that matter? Yes. The importance of meet-ups became clear as I began to dig around. Tech meet-ups build connections based on shared objectives, say around the use of a particular technology like AI, wearables, robotics or drones. See them as the hidden underwiring of Europe’s digital innovation; they are the networks of people that enable innovative technologies to scale and make the great leap forward. There are thousands of them happening every week across the UK and Europe, and you can track the region’s specializations as they scale. So guess where AI is beginning to scale in Europe? It’s the UK (for now). And who knew Manchester was such a hot test-bed for AI research and best practice…

The nub of Brexit issue as it relates to the future of work is the UK is Europe’s de-facto start-up engine. It has access to multiple sources of capital; its home to world-class universities (Cambridge, Oxford, etc.). And you’ll find deep specializations in machine learning and augmented reality (the bright shining stars of new technology), Fintech, cybersecurity, tech for education and insurance, mobile commerce (the list goes). Bear in mind start-ups need money, and the UK through London offers a plethora of crowdfunding companies, global VCs, angel investors, mid-sized and large investment companies, and private investment opportunities. This is why the handling of Brexit is critical to get right—and more so for our friends on the continent.

Humor me, but can you imagine, for one wild moment, that California succeeded from the United States of America and removed the start-up dynamo that is Silicon Valley? Imagine what shutting that off would mean for the future jobs that the US economy needs? It’s unthinkable, right? But this is precisely what removing the UK will mean for Europe. I use the phrase “digital ecology” in my report to describe the network of universities, accelerators, incubators, talented entrepreneurs and the dense support networks that enable pockets of tech specialization to scale. It sounds dramatic, but Brexit could rip out the heart of the digital ecology in Europe needs. Europe will become ever more reliant on even more cross-regional (government) funding to underpin its economic ambitions. And native entrepreneurs should be concerned about the dominance of government funding for start-ups because it holds back the chances of attracting private sector backing and present disincentives to address structural problems (like problematic education systems or over-eager protectionist regulations).

In the interests of impartiality, I am going to take a positive spin of what Brexit could mean. As Europe seeks to build a dynamic and open digital economy, it needs a new center of gravity. Brexit could well be the catalyst to reset the dynamics of how and where decisions around emerging industries are taken. One of the more outlandish ideas I have been exploring (and one that might well end up on the cutting room floor) is the need for Europe to build a new digital capital as a locus for decision making. The region needs another pole, another focus where a raft of regulations, lobbying, and decision making that underpin the region's future can take place. Building an institution, with the teeth to define digital rules, promote cross-regional innovation and provide seed capital will do this. And you know what? Relocating the hub outside northern Europe, where Europe’s executive power resides, will shift Europe’s center of gravity and provide a powerful counter-pull to the UK. My money is on Eastern Europe and if you pushed me, then I would plumb for Warsaw, at the heart of the continent.

PS. I try to be apolitical about Brexit because you have to try and see both sides no matter how disagreeable they seem. Empathy, understanding and reasoned logic must be the way to discuss an issue as loaded as Brexit. One rule my father imparted to me when the divisive Thatcher was in charge “People get the governments they deserve” still counts today

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