Prime Minister Trudeau rightly pointed out in Davos, at this year’s World Economic Forum, that Canada must evolve to a digital innovation economy. The Prime Minister was right in pointing out the necessity of this shift.
Our Minister of Innovation, Science and Economic Development, Navdeep Bains, delivered a keynote address at a recent event where he spoke at length concerning the merits of the sharing economy.
On the Conservative side of the aisle, Interim Leader Rona Ambrose recently appointed MP Alex Nuttall as opposition critic for the so-called sharing economy.
This is all great news. Now, it’s time to discuss what concrete actions can be taken to ensure the above actions and statements convert to common sense policy.
The UK is certainly making this transition. In their 2015 budget, the UK Government declared their intention to make the UK the “global centre for the sharing economy.”
What should Canada’s response be to the UK’s ambitions? Challenge accepted! A friendly challenge of course, among commonwealth friends.
Canada should be seeking to lead the global charge with regards to the sharing economy. But so far, we are losing, and here’s why it matters so much.
Let’s step back quickly. The sharing economy is the umbrella that encompasses hundreds of online platforms that turn otherwise unproductive assets, such as your home and car, into income-producing ones. And, although the term is ambiguous at best, it represents a fundamental shift in consumer behaviour. It will, and has, changed how we as a society view important economic principals such as abundance, ownership, and scarcity.
Why is this economic shift a good thing? Easy.
JP Morgan recently conducted a study of hundreds of thousands of bank accounts of sharing economy workers, concluding that this work increases incomes by 15 percent. In 2013, Forbes estimated that the sharing economy paid out a total of $3.5 billion directly to workers. I can’t even imagine what that figure is now.
Check: more money in our pockets.
Another study found that in one year Airbnb brought in $54 million in economic activity to Montreal alone. Concluding what is already obvious, a study by BIS Shrapnel found that this economic impact on cities increasingly includes neighbourhoods that have yet to benefit from tourism dollars. That is, until Airbnb arrived.
Check: encouraging flexible micro-entrepreneurship and tourism.
As of 2015, there were an estimated 10 million Canadian sharing economy participants. Moreover, two-thirds of Canadians reportedly believed the sharing economy is a good thing. Check: already widespread.
According to estimates, and common sense, car-sharing reduces car ownership by a ratio of 9-13 cars owned to one car shared. Check: reduce wasted capacity.
In Canada, the estimated economic impact nationwide is between $10 and $20 billion. Check: creation of new industry.
A September 2015 Wellesley Institute report concluded that “from a health perspective there are a number of potential benefits to the sharing economy.” Check: supporting aging demographics.
86% of a recent PWC survey respondents agree that the sharing economy makes their lives more affordable. Check: happy citizens.
And so on.
We have all heard the debates surrounding the so-called sharing economy in Canada, typified by the ongoing Uber wars in municipalities across Canada. Fortunately for Ottawa and Toronto, common sense prevailed.
And, although how we react to the sharing is often controversial and fractious, the fundamental idea and business model behind it are not.
No one would disagree with people making money from things they already own, as long as it’s done in a safe and sustainable manner. Since we can all agree with this statement, let’s end on it.
Canadian values are centered on openness, to new people and ideas, which naturally lends itself to these types of innovation.
Progress is messy, as Hegel succinctly said. So let’s get to it Canada!
Glenn Carter is a sharing economy expert and is sharing his passion for side income through new digital platforms with his readers.