Report: Cloud to Create 'Significant' Job Opportunities

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Recruiters Identify Top 10 In-Demand Technology Skills

The tech recruiting market is active and hiring managers have defined the priorities to start 2012.

As noted a couple of weeks ago, more than 10,000 job ads have been posted online in the past three months that include requirements for cloud computing skills, an increase of 61 percent over the same period last year, according to talent-market BI vendor Wanted Analytics.


Cloud computing is expected to create significant employment opportunities worldwide, according to a report by the The London School of Economics and Political Science. It examined the anticipated economic impact on the aerospace and smartphone services industries in the United States, UK, Germany and Italy from 2010 to 2014.


Of course, the smartphone services industry is growing very rapidly. The aerospace industry, not so much. Jobs in the smartphone sector were projected to grow by 168 percent in the United States during that period, with aerospace jobs growing by 57 percent. By percentage, the other three markets were projected to have whopping growth in smartphone jobs, but the starting actual numbers are small. For instance, U.S. jobs in cloud-related smartphone services are expected to grow from 19,500 in 2010 to 54,500 in 2014, compared with a projected 4,040 equivalent jobs in the UK.


It found the United States leading the way in cloud adoption, largely due to lower electricity costs and less restrictive labor regulation. In a 2011 survey, 84 percent of IT shops reported using at least one cloud-based application.


Said the authors:

Our analysis shows jobs shifting from distributed data processing facilities to consolidated data centers, resulting in a drop in data processing jobs overall as efficiency gains occur especially through public cloud services. We see a reduction in IT administrators within large firms in smartphone businesses (and most likely in many other similar sectors) compared to their level of employment otherwise expected by taking into account overall IT spending.

Other findings:


  • Cloud computing is directly creating employment through the construction, staffing and supply of data centers.
  • Data center construction, direct staffing and jobs created in the technology hardware sector explain almost all the net gain in IT jobs short term.
  • There is little risk of net unemployment by investing in the cloud.
  • As companies switch to virtualization and cloud computing, related skills will be in high demand, meaning higher-than-average salaries. Salaries for managers of IT facilities and IT administration in the United States are estimated in the range of $70,000-$120,000.
  • Productivity gains from cloud computing will allow the redeployment of managers and skilled employees to more strategic and revenue-enhancing activities at enterprises and small businesses.
  • Data-transfer policies, such as security and privacy, can have economic effects that can directly affect employment. Energy costs and policies on training and retraining also come into play.
  • Geopolitical stability is the only factor rated higher than energy costs in determining where companies locate their data centers.
  • At new smartphone and aerospace businesses, as many as 10 percent of new hires are expected to be related to managing the relationship between customers and cloud computing.
  • Small companies and manufacturers in particular are more likely to eliminate rather than redeploy staff who had been managing hardware, so the challenge for managers is to find ways to redeploy those skilled professionals into other productivity-enhancing roles.
  • The smartphone services sector is expected to employ more IT professionals than aerospace by 2014.
  • Fifty percent of public cloud jobs generated by European business activities will be at U.S. companies, though as a National Science Board report recently pointed out, that doesn't necessarily mean physically in the United States.


The report also talks about evolving skills, including more information analysis, management skills to ensure high quality of service, appropriate terms of contract, and knowledge of industry trends, including prices, to gain the best terms and service. A Danish Technical Institute study describes these as "enhanced technical knowledge and contract negotiation skills." A CIO.com article last year referred to managing multiple vendors as "cat herding." The study goes into more detail for roles such as enterprise architecture - there's no need to build everything in-house anymore - demand management and global sourcing. Likewise, the CIO role is described as evolving toward more strategic responsibilities, something HCL Technologies has called the "Reincarnate CIO," one who can drive business growth.


Joe McKendrick, who previously wrote job descriptions for the cloud, in this Forbes piece also points to the "cloud dividend" for enterprises, cited in the London School of Economics report:

These gains will be "in the form of shifting the work of existing IT staff towards general administrative responsibilities and strategic management rather than exploiting short-term payroll-reduction opportunities. Herein lies one of the main new skills challenges to the existing labor force.