REDMOND,
Wash. — Oct. 18, 2007 — Global spending on information
technology will create 7.1 million new jobs and 100,000 new businesses
over the next four years, according to a new study by IDC. The research
predicts that in 2007 Microsoft-related activities are responsible for
14.7 million jobs from an IT industry total of 35.2 million people — 42
percent of total IT employment globally in 2007 — and more than $514
billion* in tax revenue worldwide. “Today
technology is a key factor for economic, social and technological
progress, and for the sustainability of economies all over the world,”
said John Gantz, chief research officer at IDC. “The IDC research
underscores what we’ve always known to be true: that software provides a
disproportionate contribution to a vibrant IT economy. It also shows
the significant contribution made by the Microsoft®
ecosystem, especially in the creation of local businesses and local
jobs.” IDC’s independent research, which was
sponsored by Microsoft Corp., examined the IT industry’s impact on local
job creation, company formation and tax revenues in 82 countries
representing 99.5 percent of the total technology spending worldwide.
IDC found that the Microsoft ecosystem — defined as people working at IT
companies and IT professionals who create, sell or distribute products
that run on Microsoft platforms — plays a key role in driving the IT
industry’s overall contribution to job growth and economic development. The study also found that Microsoft serves as an
economic catalyst in every country in which it operates. The revenues
earned by companies working with Microsoft far exceed the revenues
earned by Microsoft itself. The research found that for every $1 that
Microsoft earns in 2007, companies working with Microsoft will earn
$7.79. In addition, according to the research findings, in 2007 more
than 640,000 vendors in the Microsoft ecosystem will make more than $425
billion in revenues, and invest $100 billion in research development,
marketing, sales and support in local economies. “Information technology is the most powerful thing
that has happened to mankind right now. It’s a new opportunity to
change the world in a very different way,” said 2006 Nobel Prize Winner
Dr. Muhammad Yunus, founder and managing director of Grameen Bank,
speaking this week at Microsoft headquarters. “This is a chance for us
to bring information technology to the poorest people, so the potential
energy and creativity that each one of them has can be unleashed.
Microsoft can play a tremendous role because they are at the top of the
technology pyramid. If Microsoft puts their mind to it something
dramatic can happen. This is an opportunity that we cannot ignore.”
“IDC’s research quantifies the enormous
power of software to create local jobs and grow economies around the
world, in both developed and developing markets,” said Craig Mundie,
chief research and strategy officer at Microsoft. “Millions of people
are employed globally in Microsoft-related activities, generating more
than a half-trillion dollars in taxes in 2007 for governments worldwide.
Microsoft’s business model creates average revenues of more than $7 for
other companies for every $1 Microsoft takes in. Countries such as
China, India and Russia see earnings in excess of $16 to $1.” In the 82 countries and regions surveyed, the IT
industry overall is expected to see continued strong growth over the
next four years, generating an additional 7.1 million new jobs from a
2007 base of 35.4 million for a total of 42.5 million jobs by 2011. The
No. 1 source of new IT jobs will be China, followed by the United
States. In addition, the growth in the global labor force will result in
new incremental tax revenues of $592 billion to governments over the
next four years. The study shows that spending
on IT will reach $1.2 trillion worldwide in 2007, and is expected to
grow 6.1 percent a year for the next four years, a rate twice that of
the expected growth of gross domestic product worldwide. The study also
found that IT spending on software creates a disproportionate share of
the skilled job growth. Software drives activity in the services and
distribution sectors, as well as in organizations using IT, so while
worldwide spending on packaged software will be only 21 percent of total
IT spending in 2007, 50 percent of employment in IT will be
software-related. Illustrating the powerful
economic impact of the Microsoft ecosystem, partners all over the world
are innovating and experiencing significant business growth. “Migrating to Microsoft technologies and becoming
part of the Microsoft Partner Program has been one of the best business
decisions our management team has ever made,” said Tim Wallis, CEO of
Content and Code, a company in the United Kingdom. “With Microsoft
technologies, we can offer more competitive price points, affordable
licensing options and an integrated technology environment that is
easier to support for our customers. It’s hard to pinpoint how much all
this factors into our 100 percent growth rate of recent years, but I
believe that the more we focus on Microsoft, the faster we grow.” Wicresoft Co. Ltd., a Microsoft partner based in
China, grew from 70 to 1,000 employees in a short amount of time and
generated a sales volume of $32 million last year alone. “To date, many of Wicresoft’s milestones and
achievements in the last five years have been accredited to Microsoft’s
help to achieve international excellence,” said Ingrid Wang, president
of Wicresoft. “Through Microsoft’s training programs our sales staff
completed a year’s sales volume in only half a year. Our business
boomed. We have had a successful transformation from novice member of
China’s IT ecosystem to international player. We treasure the strategic
alliance with Microsoft here in China.” “As
Microsoft’s ISV Partner of the Year in 2007, Workshare shares
Microsoft’s drive to create industry growth,” said Joe Fantuzzi, CEO of
Workshare. “Our investment in Microsoft infrastructure, coupled with
Microsoft’s product and field team support, enables us to assist our
customers in 6,000 organizations across 65 countries.” Study Highlights The following trends were observed across the 82
countries and regions: Global | • | Microsoft is a major component of the IT industry.
Microsoft and its ecosystem — the companies that create products that
run on Microsoft platforms, service Microsoft products, or work with
Microsoft products — employ 14.7 million workers globally. This
ecosystem helps spur the development of national IT-related economies. | | • | Global spending on information technology will
create 7.1 million new jobs and 100,000 new businesses over the next
four years. | | • | The Microsoft ecosystem
employs at least 40 percent of the people working in the IT industry.
The same ecosystem is projected to invest nearly $100 billion in local
economies in 2007. | | • | Software
accounts for a modest slice of overall IT spending but has a
disproportionately positive impact on local economies. Software drives
activity in the services and distribution sectors, as well as in
organizations using IT, so while worldwide spending on packaged software
will be only 21 percent of total IT spending in 2007, 42 percent of
employment in IT will be software-related. | | • | Tax revenues (including value-added or sales taxes,
personal income, social taxes, fees and levies, and corporate income
taxes) that result from the activity of Microsoft and its ecosystem will
amount to $514 billion in 2007. | • | In the United States alone,
tax revenues from the Microsoft ecosystem will be just $203 billion in
2007. | | • | In Western Europe alone, tax
revenues from the ecosystem will be just under $133 billion in 2007. | | • | In the Asia-Pacific region, tax revenues from the
Microsoft ecosystem will also total nearly $133 billion in 2007. | | • | In emerging markets, tax revenues generated by the
ecosystem will be more than $100 billion in 2007. |
| | • | Incremental new taxes accrued over the next four
years due to growth in the IT labor force will equal $592 billion
worldwide. |
North
America | • | While software spending represents 27 percent of
North America’s total IT market, 65.7 percent of IT employees are
engaged in creating, distributing, installing or servicing software. | | • | In 2007 the Microsoft ecosystem is expected to
generate more than $166.1 billion. | | • | For every U.S. dollar of Microsoft revenue in North
America, $6.14 is generated by other companies in the Microsoft
ecosystem of hardware OEMs, software companies, and channel and service
firms. |
Central
and Eastern Europe | • | While software spending
represents 13 percent of the region’s total IT market, 39.8 percent of
IT employees are engaged in creating, distributing, installing or
servicing software. | | • | In
2007 the Microsoft ecosystem is expected to generate more than $19.5
billion. | | • | For every U.S. dollar of
Microsoft revenue in the region, $14.07 is generated by other companies
in the Microsoft ecosystem of hardware OEMs, software companies, and
channel and service firms. |
Western Europe | • | While
software spending represents 21 percent of the region’s total IT market,
56.6 percent of IT employees are engaged in creating, distributing,
installing, or servicing software. | | • | In 2007 the Microsoft ecosystem is expected to
generate more than $124.1 billion. | | • | For every U.S. dollar of Microsoft revenue in
Western Europe, $7.68 is generated by other companies in the Microsoft
ecosystem of hardware OEMs, software companies, and channel and service
firms. |
Asia
Pacific | • | While software spending represents 15 percent of the
region’s total IT market, 35.9 percent of IT employees are engaged in
creating, distributing, installing or servicing software. | | • | In 2007 the Microsoft ecosystem is expected to
generate more than $83 billion. | | • | For every U.S. dollar of Microsoft revenue in the
region, $11.18 is generated by other companies in the Microsoft
ecosystem of hardware OEMs, software companies, and channel and service
firms. |
Mundie
reiterates Microsoft’s strong commitment to contribute significantly to
local software economies. “Information technology has already helped
empower more than a billion people, but there are another 5 billion we
have yet to reach,” he said. “As part of Unlimited Potential and as
highlighted by IDC’s analysis, Microsoft is committed to transforming
education, fostering local innovation, and enabling jobs and
opportunities to help create a sustained cycle of social and economic
growth for everyone. Our goal is to enable people and communities around
the world realize their dreams through relevant, accessible and
affordable technologies.” About IDC
Methodology This study applies IDC’s
Economic Impact Model, which assesses the IT industry’s impact on job
creation, company formation, local IT spending, and tax revenues in
addition to assessing Microsoft’s partner ecosystem. The study’s
spending figures accounted for hardware, software, services and data
networking expenditures by consumers, businesses, governments and
educational institutions within each country. Tax revenue figures were
based on potential VAT or sales tax revenues from the sale of hardware,
software, or services, as well as business and personal income taxes and
social taxes. IT employment included the number of people employed
(full-time equivalent) in hardware, software, services or channel firms,
and those individuals managing IT resources in an IT-using organization
(e.g., programmers, help desk, IT managers). All data was cross-checked
against published information and census data available from government
sources and validated by local government officials. For information
about how to obtain a copy of this report please visit: http://www.microsoft.com/About/CorporateCitizenship/Citizenship/EconomicImpact. About Microsoft Founded in 1975, Microsoft (Nasdaq “MSFT”) is the
worldwide leader in software, services and solutions that help people
and businesses realize their full potential. Note
to editors: If you are interested in viewing additional information
on Microsoft, please visit the Microsoft Web page at http://www.microsoft.com/presspass
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have changed. For additional assistance, journalists and analysts may
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