The use of Big Data could unlock as much as $5 trillion in economic value a year, and it’s falling on colleges and universities to ensure such a boon happens.

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Big Data could unlock up to $5 trillion in economic value.

Higher education institutions in recent years have invested hundreds of millions of dollars in data research and tools. Some universities are putting up this money themselves, while others are relying on government and organization grants.

The Gordon and Betty Moore Foundation and the Sloan Foundation have pledged $37.8 million to the University of California at Berkeley, the University of Washington, and New York University for Big Data collaboration over the next five years.

IBM has partnered with more than 1,000 institutions around the world to create Big Data seminars, courses, and even full masters programs.

This the final part of an eCampus News series on the power and pitfalls of Big Data in higher education. Click here to read Part One, and click here to read Part Two.

The value for companies like IBM goes beyond just the obvious benefit of selling data tools to schools.

The demand for people with data analytics skills is expected to increase by 24 percent over the next 8 years, according to the U.S. Bureau of Labor Statistics. In two years, there will be 4.4 million jobs dealing with Big Data.

That’s far more jobs than people who can do them, said Jim Spohrer, director of Global University Relations Programs at IBM, calling the problem a “Big Data skills gap.”

“From all sectors, there’s just a tremendous demand for it, so we’re working with our customers and stakeholders,” Spohrer said. “This is the kind of thing IBM does routinely, like in the 60s and 70s with mainframes. These kinds of new opportunities require new skills, and it’s a natural part of our business to do these private public partnerships to increase the number of people with those skills.”

Ellen Wagner, executive director of the WICHE Cooperative for Educational Technologies, said she expects to see more and more institutions teaching data science to students, but it’s hard to tell if the workforce will be as large as IBM predicts it will need to be in just a few years.

“I think you’re going to see places that believe they have a leg up on their fellow practitioners by offering these courses,” Wagner said. “It’s very hot stuff, but people aren’t sure what to do. Maybe it will be slow and start with simple courses, or it might be as full-blown as full degree programs.”

If institutions can’t help close the skills gap, Big Data experts said that the global economy could lose out on trillions of dollars.

A recent report by the McKinsey Global Institute estimated that “open data” alone (Big Data that is made freely available to others) would “unlock $3 trillion to $5 trillion in economic value annually across seven sectors.”

The potential value of open data, the institute estimated, could be as much $1.4 trillion in consumer products; $920 billion in transportation; $580 billion in electricity; $510 billion in oil and gas; $450 billion in health care; and $280 billion in consumer finance.

The sector with the most to gain, McKinsey Global concluded, is education.

“Annual spending on K-12 and post-secondary education exceeds $4 trillion worldwide,” the report stated. “With so many resources dedicated to public education, there are substantial opportunities to increase the efficiency and effectiveness of current systems.”

By using data to improve instruction, match students to programs and employment, make education financing more transparent, and increase the efficiency of system administrations, the education sector could see an increase of $900 billion to $1.2 trillion in additional annual value.

All of this, of course, is reliant on schools actually making a push toward Big Data programs, Wagner said, and that’s why organizations, companies, and government entities are making a push of their own – that marketing move Harper Reed, the chief technology officer of President Obama’s 2012 campaign, called “bull—” in October.

“I’m not opposed to what companies like IBM are trying to do,” Wagner said.  “They have products that institutions want to buy, and they are all discovering that there is no winner if nobody is sure what to do with these amazing platforms and tools. The reality is that all of us should be more data-literate in post-secondary education, but we can’t just believe all the hype either. Everyone’s trying to figure out this very particular dance.”

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