Microsoft: Cloud computing to create millions of jobs

Microsoft today published commissioned research from analyst firm IDC indicating that cloud computing will create nearly 14 million new jobs globally by 2015.

IDC’s research predicts revenues from cloud innovation could reach $1.1 trillion per year by 2015, which, combined with cloud efficiencies, will drive significant organizational reinvestment and job growth.

Total cumulative jobs generated by cloud computing worldwide at year-end, 2012-2015:

For four years now, IDC has been estimating the economic impact of public IT cloud services by taking conservative estimates of the degree to which they could increase IT innovation and then estimating the revenue and potential jobs driven by that innovation.

The following factors play into that equation:

  • IDC estimates that, worldwide, 75% of IT spending is tied up with maintenance of legacy systems and routine upgrades, or “legacy drag.” Cloud computing allows IT organizations to shift some of that legacy work to the cloud, freeing up budget to invest in IT innovation that supports business innovation.
  • Lower IT and business process costs driven by the economies of scale in infrastructure and talent of cloud computing also free up funds for new business investment.
  • The ratio of IT spending as a percentage of revenue is small for most organizations — 1% to 4%, generally. Conversely, business revenue, when driven by innovative IT, can be a significant multiple of IT investment.

“For most organizations, cloud computing should be a no-brainer, given its ability to increase IT innovation and flexibility, lower capital costs, and help generate revenues that are multiples of spending,” said John F. Gantz, chief research officer and senior vice president at IDC.

“A common misperception is cloud computing is a job eliminator, but in truth it will be a job creator — a major one. And job growth will occur across continents and throughout organizations of all sizes because emerging markets, small cities and small businesses have the same access to cloud benefits as large enterprises or developed nations,” Gantz added.

The report also indicates specific industries will generate job growth at different rates, and that public cloud investments will drive faster job growth than private cloud investments.

The report also notes governments can influence the number of jobs created by cloud computing within individual countries.

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