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Microsoft, General Assembly Collaborate to Develop AI Skills

Zacks Equity Research

Microsoft MSFT recently partnered General Assembly (“GA”) in an effort to expand workforce for advanced technology jobs with primary focus on developing AI skills.

Per the terms of the deal, workers will be offered training on utilizing data science, AI, machine learning (ML) skills in data and cloud engineering domains.

In the first year, Microsoft and GA target 2,000 job transitions into AI and ML work profiles. Eventually, another 13,000 workers within next three years are aimed to assume AI-related jobs. This translates to influx of 15,000 new workers with AI skills strengthening the technology workforce by 2022.

New York-based, GA is primarily engaged in providing design, programming and management training services to individuals seeking to be part of white collar workforce. GA is part of Switzerland-based The Adecco Group, which provides human resource services.

Into the Headlines

Per the collaborative program to impart AI skills to workers, Microsoft will serve as the founding member in AI Standards Board. As the name suggests, GA’s Standards Board is responsible to set the standards and create an appropriate framework for the program.

The joint program also attempts to offer training such that workers, including Microsoft's customers can leverage Azure capabilities.

We believe that Microsoft will benefit from the program, primarily due to the fact that it is likely to lead to workforce expansion which is capable of utilizing Azure capabilities. The company’s customers looking to leverage Azure capabilities remain noteworthy beneficiaries.

Moreover, to ensure a sustainable pipeline of AI trained candidates for project-based requirements, Microsoft and GA will set up AI Talent Network.

These initiatives hold promise and are expected to create a sustainable source of AI and other emerging technologies-trained individuals.

What Investors Should Know?

Shares of Microsoft have gained 33.4% in the past year, outperforming the industry’s rally of 27.2%. The outperformance can be attributed to investors’ optimism in strength in Microsoft Azure, Office 365 suite and robust AI capabilities.



As AI and robotics are becoming mainstream; the work place is transforming, paving the way for more skilled jobs to sustain digital transformation. Lack of skilled workers particularly from STEM (Science, Technology, Engineering and Mathematics) fields in the United States has been hindering technology players for quite some time.

Per World Economic Forum report on Future of Jobs 2018, ongoing disruption in division of labor between humans, algorithms and machines is anticipated to create “new roles” of around 133 million by 2022.

Earlier, Microsoft quoted an estimate by which, “by 2022, a talent shortage will leave as many as 30% of AI and data skills jobs open.”

We believe the latest development is in sync with Microsoft’s aim to address the much-hyped AI skills crisis. In fact, the company has also collaborated with OpenClassrooms, in this regard.

Wrapping Up

Evolving technological methodologies leads to the need of enhancing the skill set among workforce. Other tech bellwethers are also looking for ways to expand the workforce updated with modern skills. For instance, IBM recently announced that it is expanding new collar program in France.

We believe these initiatives will help plug in the gaps to lead to a sustainable workforce and address emerging “AI Skills Crisis” in an effective manner. Moreover, research on emerging technologies is likely to drive innovation. We are of the opinion that transforming the work to a more-skill oriented one will drive costs down considering the broader outlook.

Zacks Rank & Other Key Picks

Currently, Microsoft carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks worth considering in the broader sector, include Cadence Design Systems CDNS, Verint Systems Inc. VRNT and j2 Global, Inc. JCOM, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Cadence, Verint and j2 Global is pegged at 12%, 11% and 8%, respectively.

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