Driving COVID-19 recovery with a data centre skills strategy

Dan Ayley

Director, London

UK

Global demand for data centres was outstripping supply even before COVID-19 struck. As the pandemic brings huge disruption and reconfiguration of both working patterns and our everyday lives, internet usage is reported to be up by as much as 50 percent in some European markets.

While the industry has – so far – been able to withstand this pressure, data centre expansion now needs to accelerate at pace to meet the additional user demand. The key players will be focused on gaining a competitive advantage.

However, the sector must tread carefully. As governments worldwide contend with how to re-start economic activity safely, uncertainty looms large over future investment into IT by a range of industrial sectors grappling with anticipated recession.

In this scenario, agility and good decision making will be essential. The big question, however, is whether the industry has the capacity and depth of skilled resource.

Supply chain risks

Skills gaps have been a key concern for some time and the current crisis has exacerbated existing risks. Data centre providers face significant and additional supply chain vulnerabilities related to the availability of skilled labour, the potential collapse and insolvency of contractors, the need to maintain social distancing on sites and delays to the import of materials for construction.

All of these have the potential to curb productivity and opportunities for the sector’s growth. Although many of these challenges are common to other industrial sectors, they are made more acute by the “closed” industry that surrounds data centre construction.

At the start of this year – before coronavirus had even entered public consciousness – only nine percent of respondents to our annual data centre cost index survey believed that the data centre construction industry had been able to meet demand during 2019.

For years, it has been apparent that there are simply not enough consultants and contractors in the market with the relevant data centre experience to allow for a significant expansion in output.

What’s more, fierce competition for a small supply chain looks set to drive up capital costs and thereby limit returns.

While COVID-19 poses many challenges, we also need to seize the opportunity presented by the current crisis to tackle this systemic shortfall of specialist skills. This is the chance for the data centre construction industry to invest in building its capability for the long term.

Aligning sector and regional expertise

The key to success will be building capability within global regions – breaking down the inherent tension in the sector between the requirement for trusted expertise alongside the need to adapt to local market conditions.

At the moment, the data centre construction community is small and close-knit – the pool of contractors and consultants with the requisite experience and skillset is narrow, and clients are reluctant to bring new talent onto their programmes without the right credentials.

Yet at the same time, they are increasingly looking for localised market knowledge and oversight. US investment has been flooding into Europe in recent years, to host the ‘big three’ tech platforms, and this is driving growth in secondary markets such as Zurich, Munich and Berlin as the established Frankfurt, London, Amsterdam and Paris (FLAP) markets remain hot. These overseas clients and asset owners need management of their projects on the ground, to proactively manage and mitigate supply chain pressures across distinct markets and countries.

As travel uncertainty makes it harder to fly-in expertise, the sector needs to focus on how it builds local skills bases. We need to see a global push to attract fresh talent into the industry and invest in appropriate training and skills programmes.

An engine for growth

The coronavirus pandemic has shone a light on data centres as critical infrastructure – and we need to capitalise on this to better promote and support the career opportunities available within the sector.

The trajectory of digital demand is clear – whether this is temporary or the ‘new normal’ – and we cannot afford to put future data centre construction or development on hold.

But nor can the data centre industry neglect its wider responsibilities either. The world has seen the sort of irreversible shift that comes only once in a generation. The data centre industry, which has long underpinned how we all work, live, shop and socialise behind the scenes, is now centre stage and – by driving up local skills bases – can act as an engine for recovery.

We must use the limelight to make sure that as an industry we have the capacity and players to carry on performing and delivering the digital infrastructure that will define our societies for the years to come.

Further resources

Please visit our COVID-19 response page for all of our resources relating to the impact of COVID-19 on the construction sector.

For further information contact:

Dan Ayley
Director, London

t: +44 (0)207 5444000
e: