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Cloud computing will create over 200,000 UK jobs, says IDC

SMEs will adopt cloud computing faster than larger companies straddled with legacy systems

Spend on public and private cloud computing services will create 226,000 jobs in the UK by 2015, according to a study from analyst firm IDC.

These would be part of the approximately 14 million jobs that would be created globally during the next four years, the study, 'Cloud Computing's Role in Job Creation', commissioned by Microsoft, claimed.

The researchers said that cloud computing is different from traditional outsourcing, but could change the skills requirements in an IT organisation.

"In discussions we have had with CIOs testing and experimenting with cloud computing, we find that most look at migration to cloud computing as a way to free up existing resources to work on more innovative projects, not to do away with positions entirely," IDC said.

The research provides a global extension to a similar report that the Centre for Economics and Business Research (CEBR) published for vendor EMC at the end of 2010. The EMC study predicted that 289,000 jobs would be generated in the UK over the 2010 to 2015 period, contributing to the more than 2.3 million jobs expected to be created across France, Germany, Italy, Spain and the UK.

More than half of the new jobs will be found in SMEs, and more than one million jobs each will be created in the banking, communications and discrete manufacturing industries, IDC predicted.

The analyst firm believes that smaller companies will adopt cloud IT services faster than larger companies because they have fewer legacy systems to deal with and because budget constraints make public IT cloud services more attractive to smaller firms than larger firms.

The majority of new jobs will be created in emerging markets, for example in China and India, where the size of the workforce is greater.

"We tend to think of China and India as emerging markets, but they're actually early adopters of the cloud," said John Gantz, senior VP at IDC.

"They're not bound to existing systems. They've skipped that step, so there's less holding them back."

IDC said that smaller companies will adopt cloud IT services faster than larger companies because they have fewer legacy systems to deal with, and because budget constraints make public IT cloud services more attractive to smaller firms than larger firms.

In addition to driving a jobs growth, IDC found that IT innovation created by cloud computing could produce $1.1 trillion (£696 billion) a year in new business revenues globally.

Cloud computing can help companies become more innovative by freeing up IT managers to work on more mission-critical projects, instead of focusing on "basic plumbing".

Also, companies can use the cloud to improve the way they work with partners and customers, for example, by communicating with them using cloud-based collaboration software.

"Enterprises that embrace cloud computing reduce the amount of IT time and budget devoted to legacy systems and routine upgrades, which then increases the time and budget they have for more innovative projects.

"When IT innovation happens, business innovation is reached, which then supports job creation," said Gantz.


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