What does the digital economy mean for jobs?

In October 2013, Apple announced that its popular App-Store had touched the 1 million apps milestone. What is remarkable about this milestone is not only the magnitude but also the number of jobs that would have been created worldwide to support the creation of these 1 million apps. Apple has created direct employment through its 80,000 global workforce.

However, the indirect employment it has created is much higher. An estimated 600,000 jobs have been created or supported for US workers alone, and include the engineers who invented the iPad to the delivery person who takes it to the customer’s doorstep. This phenomenon – the creation of a small set of direct jobs complemented by a larger set of indirect jobs – is the outcome of an innovative 21st-century business model. Thanks to new business models such as revenue-sharing and partner agreements and collaboration, jobs are moving out from the boundaries of the enterprises to the wider communities.

InnoCentive, the Massachusetts-based open innovation company, is a great example of this with its anyone, anywhere approach, accepting by commission R&D problems in a broad range of industry domains. Google, Android and Facebook have also been active in leading this phenomenon. With their 1 billion Android device activations and 1.2 billion users, Android and Facebook respectively have also created large-scale employment around the world.

As business leaders gather at Davos to find solutions to some of the most pressing issues in the world today, they need to focus on creating jobs in large numbers. New business models that redefine direct and indirect job creations will be much-needed to address the scale of these challenges.

Kris Gopalakrishnan is President of the Confederation of Indian Industry, Vice-Chairman of Infosys and Co-Chair of the World Economic Forum’s Annual Meeting 2014 in Davos-Klosters.

Image: A woman speaks on her BlackBerry mobile phone at a shopping mall in Dubai. REUTERS/Lucas Jackson