Valuation of companies above the value of available assets will lead to stagnation in the field of mergers and acquisitions
In 2021, M&A transaction volumes reached a new peak, fueled by low interest rates and high stock prices. However, the situation will change in 2022: large mergers and acquisitions will occur less and less, as the valuation of companies continues to rise. And only companies with a strong market position and large cash reserves will have opportunities for new acquisitions. The high threshold for such transactions will complicate the growth and development opportunities for small and medium-sized companies and create benefits for larger players with a strong market position.
AI and automation will lead to a reduction in entry-level positions
A large number of jobs will be vacant due to a shortage of staff, leading to the use of artificial intelligence and automation to fill the gaps in these positions. We have already witnessed the beginning of the expansion of these technologies in the service industry, when robotic waiters appeared during the pandemic. In 2022, we will see AI and automation systems replace employees in selected positions in the sectors most affected by the pandemic, such as finance, healthcare, legal services and software development. This will mainly affect entry-level positions, such as interns (yesterday’s graduates will find it even more difficult to enter the profession in order to gain experience).
CI / CD are stabilized and standardized, becoming one of the requirements of IT departments
The Bill Gates memorandum in 2001 became the industry standard for the design, development and marketing of complex software systems, and it appears that no new standards have emerged to this day. IT departments and developers are accustomed to using well-known technology systems and not standardizing new ones such as CI / CD (Continuous Integration and Continuous Delivery). In 2022, CIOs will be able to leverage the power of this fast-growing and highly profitable segment by increasing deployment activity and addressing the “second day of work” problem.
Big money and … big problems will come to the labor market in the field of high technologies
The economic changes associated with the COVID-19 pandemic have led to a wave of layoffs. This has undoubtedly had a major impact on the tech industry, where staff turnover and declining efforts by employers to retain them will trigger pay rises in 2022 in an attempt to retain high-value employees. It can be assumed that this trend will create new serious challenges, especially for startups and venture capital business: it is clear that only large technology companies will be able to satisfy high financial demands and offer additional benefits to highly demanded specialists.
After all, many innovations are created by “hungry” startups, where people work for a long time for very little money. It is quite possible that we will witness the return of qualified specialists to the ranks of the “old guard”, capable of satisfying their needs in stable (and high!) Salaries, and this may provoke a long-term shortage of talented specialists.
New privacy-focused legislation to boost interest in data sovereignty clouds
Increasing attention is being paid to the General Data Protection Regulation (GDPR), which regulates data security and privacy in the EU, and the California Consumer Privacy Protection Act (CCPA), which expands consumer privacy. This trend will continue in 2022, with more and more focus on clouds providing data sovereignty within a single state or specific physical location.
This is a much more sophisticated cloud model that is starting to emerge in the EMEA region as part of the Gaia-X initiative. Some experts will see this as a hindrance, but implementing this approach is more of a plus, as user privacy is becoming a central aspect of business strategies.
Containers will go mainstream, allowing cloud services to continue to grow
At the initial stage of the pandemic, many companies mistakenly believed that in 2021 they would return to their usual office hours. The comeback never happened, and companies had to develop long-term teleworking strategies that ensure business efficiency and resilience, and help retain employees who seek flexibility. Implementing a remote work strategy requires cloud solutions, which has led to the explosive adoption of cloud services. The containers that meet these needs will go mainstream in the coming year, greatly streamlining and simplifying the process of moving companies to the cloud.