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The Salesforce Economic Impact: 4.2 Million New Jobs, $1.2 Trillion of New Business Revenues from 2019 to 2024

The Salesforce Economic Impact: 4.2 Million New Jobs, $1.2 Trillion of New Business Revenues from 2019 to 2024

Sponsored by: Salesforce John F. Gantz

October 2019


IN THIS WHITE PAPER
This White Paper forecasts the economic contribution of Salesforce and its ecosystem of partners1 and customers to local economies in terms of jobs created and business revenue.

The text summarizes the study findings; detailed data tables are provided in the Appendix.

The study relies on IDC's forecasts of job creation from organizational use of cloud computing, IDC's tracking of Salesforce's market share, IDC's published research on the number of ancillary products and services that accompany cloud computing implementations, and a custom economic model that estimates the size of the Salesforce ecosystem.

The IDC premise, which has been driving forecasts of the economic impact of cloud computing since 2012, is that cloud computing generates economic benefits by permitting an increase in IT innovation, which, in turn, supports business innovation that creates new revenue and jobs.

This White Paper updates earlier editions published in 2015, 2016, and 2017. Detailed descriptions of the derivation of the numbers are included in the Appendix B: Methodology section.



EXECUTIVE SUMMARY
§ Driving these economic benefits is the growth of cloud computing. From the beginning of 2019 to the end of 2024, worldwide spending on public cloud computing will grow 19% a year, from $147 billion to $418 billion. Meanwhile, spending on noncloud software will only grow at 3% a year.

§ During this six-year period, Salesforce and its ecosystem are expected to enable the creation of 4.2 million jobs worldwide.

§ Over the same period, the use of cloud computing by Salesforce customers will add $1.2 trillion in new business revenues to their local economies.

1References to Salesforce's "ecosystem" in this White Paper refer to all firms that add products and services on top of Salesforce subscriptions, including not only official Salesforce consulting and ISV partners but also third-party providers brought in by those partners or the customers themselves.

§ Because organizations that spend on cloud computing subscriptions also spend on ancillary products and services, the Salesforce ecosystem in 2019 is more than four times larger than Salesforce itself. By 2024, it will be nearly six times bigger.

§ The particular jobs to be created will reflect the current occupational mix by country. The jobs created are across the board in cloud-using companies, but they will also include new jobs driven by digital transformation (e.g., jobs in robotics and artificial intelligence [AI], digital marketing, digital-assisted security, and IoT specialists in the trades).


Cloud Computing, Growing at 19%, Hits the Knee of the Curve

New technologies typically follow an "S curve" of adoption. Slow at first as early adopters experiment, then faster as implementation wrinkles are ironed out, generally when the new technology has supplanted 10–20% of the old technology.2 Then the market hits a long period of sustained growth and the substitution rate matches the straight part of the "S." Hence the term "knee of the curve."

Cloud computing is definitely there, having hit 10% of software spending in 2013 and 20% in 2017. From 2019 to 2024, spending on software delivered via public cloud services will grow 19% a year and, by 2024, will account for nearly half of all software sales. Figure 1 charts this growth.

As early as last year, IDC's Global CloudView Survey of 5,740 user organizations in 32 countries found that 60% of organizations surveyed were past the experimental stage of cloud deployment, where projects were mostly ad hoc and targeting individual workgroups and departments. One in seven reported being "cloud native," with "cloud strategies and policies consistently defined and implemented."

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