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How is cloud computing affecting employment?

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Co-authored by Francesco Pedulla, Vincent Abbosh and Thanh Lam

At a recent social media workshop on cloud, we discussed the effect of cloud computing on employment and decided to write a joint blog post addressing this topic. A few months ago, one of us readRace Against the Machine” by Brynjolfsson and McAfee. The authors argue that digital innovation has “changed how the economic pie is distributed, and here the news is not good for the median worker. As technology races ahead, it can leave many people behind. Workers whose skills have been mastered by computers have less to offer the job market, and see their wages and prospects shrink.” Their statement is not an opinion. It is the conclusion of a long, thorough study of empirical data. For the sake of discussion, we will assume it is correct.

Since Brynjolfsson and McAfee talk about innovative technologies that enable machines to replace human workers, the first question we asked ourselves was: can we apply that result to the ongoing cloud revolution? After all, the cloud is a matter of optimization through consolidation, not of replacing workers with machines. Still, the net effect of the consolidation is replacing workers with automated mechanisms. So, the real question is: if the results do apply to the cloud, then would the balance between created and destroyed IT jobs make it so that few people would lose their jobs, if any?

Although the balance could be negative when it is restricted to IT jobs that are directly impacted (like system management, database and network administrators), in the short term, the process of moving into a cloud computing economy will preserve most of these positions. This is due to the complexity of the existing systems and the length of time required to migrate to cloud based platforms without disruptions of service.

In the long term, we suspect the balance will be positive if we take into account newly created jobs. In fact, cloud enables most start-ups to implement and sell ideas with a minimum initial investment. Without the cloud, lots of brilliant ideas would never materialize. Furthermore, some of those start-ups will eventually grow into larger enterprises that hire hundreds of people.

The newly created jobs will mostly belong to a new kind of worker. They require new skills, an entrepreneurial approach, flexibility, agility and the ability to learn new skills quickly. These are the trend-setters who bring changes to reality. Take cloud computing skills, for example. You might have felt the effects at your job or read about some of the press discussions. Steve Ranger  discusses these skills in the ZDNet article “How cloud computing changes (almost) everything about the skills you need.” A quick search for jobs with the keyword “cloud computing” on Monster.com yielded us more than 1,000 matches at the time of this article!

Do you think the cloud revolution will have a positive or negative global impact on employment? What about the quality of the jobs? From our perspective, we think the effect is positive as long as training opportunities for the cloud-created jobs are available, and at a reasonable price. Could  massive online open courses (MOOCs) match that need? Well, this is the subject for another blog post.

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