Article | Evolving Workforces

Navigating Data Centres: Bridging the talent gap in Asia Pacific

September 10, 2024

By Udit Sabharwal

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The global data centre market continues to experience rapid growth, with artificial intelligence (AI) advancements fuelling demand for this asset class.1 While global co-location data centre market vacancy continues to remain low, challenges persist in securing suitable land parcels and power infrastructure for operators and hyperscalers. However, one of the most significant and often overlooked challenges lies in the talent gap, particularly in the Asia Pacific region.

The Uptime Institute estimates that by 2025, there will be demand for 2.3 million data centre workers globally, with much of this deficit concentrated in Asia Pacific.2

Securing talent remains a challenge across Asia Pacific

1-in-2 operators have noted that they have faced challenges finding qualified talent for open jobs as well as retaining their existing workforce.3 This is evident in the number of open roles across Asia Pacific. Based on data of a basket of operators4 and hyperscalers5 across the region, there were more than 2,500 job postings live as of May 2024 targeting roles in the sector.

India continues to be a key market with the largest concentration of hiring focused on the country for both operators and hyperscalers. Singapore as a regional hub continues to be equally important with a focus on more mid- and senior level managerial positions. While operators are more focused on emerging clusters such as Indonesia, Malaysia and the Philippines, hyperscalers are prioritising markets that have more mature data centre ecosystems such as Australia, Japan and Korea (Figure 1).

Figure 1: Percentage Split of Data Centre Job Postings for Operators and Hyperscalers in Asia Pacific

securing-talent-remains-a-challenge-across-Asia-Pacific-figure-1-figure-1

Source: CBRE Digital Infrastructure Advisory, CBRE Labor & Location Advisory (May 2024)

Talent shortages are more pronounced in developing data centre clusters

Markets with larger working populations typically have a larger concentration of data centre professionals such as India and mainland China. However, measured on a density basis6, Singapore has the highest talent concentration followed by Hong Kong SAR, Korea, Australia and Japan.

Attrition is partly driven by growing occupier and investor interest in the market, which increases demand and competition for talent. Markets such as Malaysia, Japan and Australia are seeing increasing interest and have experienced higher levels of attrition. Singapore’s attrition has moderated in recent months given a relatively high talent density and increased focus on markets in Southeast Asia.

Figure 2: Data Centre Talent Demand and Supply Metrics across key markets in Asia Pacific

 Figure 2

Source: CBRE Digital Infrastructure Advisory, CBRE Labor & Location Advisory (May 2024)

Investors focus on workforce quality when evaluating investment platforms

Data centre platforms with experienced market talent and industry experience are better positioned to attract investment in the region, especially from funds and consortiums that are new to the market. By focusing on workforce quality and experienced teams, investors are aiming to maximise value and mitigate risks in their investment decisions. Such evaluations that CBRE has undertaken typically involve (1) benchmarks against other regional platforms operators; (2) financial performance of the underlying companies under the management teams; and (3) level of expansion and market positioning achieved by the team under the evaluation.

AI will unlikely shift the balance in the immediate future, but opportunities exist in the longer term

Operators continue to be challenged by the talent supply and demand mismatch. Efforts to introduce AI and automation, while successful in pilots and smaller rollouts, have not had a significant impact on the talent supply gap. Operators remain optimistic about reduction in data centre operations staffing levels over the long term7 but continue to caveat that the risk-averse nature of the industry as well as the current tech focus on augmentation rather than replication of human tasks will continue to limit the potential of AI to fully solve the talent crunch across the industry.

Strategies for investors, developers and operators

Given these industry trends and challenges, we outline some recommended strategies below for data centre investors, developers and operators to more effectively bridge the talent and skills gap in the region.

Stakeholders Recommended Strategies
 Investors & Developers
  • Investors will need to evaluate additional layers focused on talent availability beyond cap rates, market ecosystems and regulatory landscapes as they look to build their internal business cases for investment in new markets.

  • For investors and developers, looking at consortiums or platforms, a detailed evaluation of the management teams as outlined earlier will be critical in ensuring not only risk mitigation but also opportunities for additional alpha generation from investments.  
 Operators 
  • Operators will need to continue to focus on upskilling the current workforce, attracting new employees through university and industry collaborations while balancing the rollout of AI pilots that augment the capabilities of the workforce. 

  • Partnering with third-party providers and specialists for core areas of facility management can further act as a way to mitigate workforce challenges, especially in more nascent and highly competitive markets.   
1 https://www.cbre.com/insights/reports/global-data-center-trends-2024
2 https://intelligence.uptimeinstitute.com/resource/people-challenge-global-data-center-staffing-forecast-2021-2025
3 https://datacenter.uptimeinstitute.com/rs/711-RIA-145/images/2023StaffingSurvey.Report.12152023.pdf?version=0&mkt_tok=NzExLVJJQS0xNDUAAAGQC0AG1v_np_N2JFBcjLR6tEMjLOeoYvvVFeRuZi0lNV2ugVGXK6nXokBPQFTHnwJIhLs-CZ-ZYQnAulMV4_A46bqbP2ZAVFiOjJMUULUlOg
4 Basket of operators includes NTT Data, Equinix, Airtrunk, Global Switch, PDG, STT, Vantage, Digital Realty and GDS. NTT Data does not include job postings in Japan.
5 Hyperscalers evaluated include Amazon (Amazon Web Services), Microsoft (Keyword leveraged = Microsoft Cloud Roles) and Google (Keyword leveraged = Google Cloud Role)
6 Talent Density measures the total professionals as a proportion of the total working population per 1,000 workers 
7 https://journal.uptimeinstitute.com/ai-will-have-a-limited-role-in-data-centers-for-now/

About CBRE Asia Pacific Consulting

CBRE’s Asia Pacific Consulting practice helps clients with complex location strategy decisions that take into account a myriad of important location factors, such as workforce strategies, locational profiling and site selections.

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