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Why Microsoft Is Buying LinkedIn For A Truly Staggering Amount Of Money

LinkedIn is a popular social network that nobody actually talks about, unless they’re joking about getting emails about being added to somebody’s LinkedIn network. Or if they’re getting their password leaked thanks to the site’s 2012 hack. And right around the fourth anniversary of that breach, Microsoft has dropped a stunning amount of cash to buy the site.

$26 Billion Worth Of Resumes

According to The New York Times, Microsoft is buying LinkedIn for $26.2 billion. For those playing along at home, that leapfrogs Facebook’s $19 billion buyout of WhatsApp for the highest price tag in social media. Just as surprising, this is a very old-school takeover: Microsoft is buying up LinkedIn stock at $196 a share, more than $60 higher than a share is currently worth.

It may seem ridiculous at first; after all, it’s unlikely you spend quite as much time congratulating your friends on their work anniversaries as you do on Facebook. But even if you only log into LinkedIn once or twice a year to update your resume, that’s still how the company makes its money. If you’ve ever gotten a baffling email from some recruiter you’ve never met, that’s thanks to LinkedIn. It has over 400 million users, and it sells its database of resume data and contact info to recruiters and sales teams. It was so effective that last fall, a share of LinkedIn went for $260, although that has since dropped to $131. That’s made LinkedIn a rarely discussed but exceptionally powerful force in the HR industry. And, in the future, that’s a good industry to be in.

Microsoft Wants To Be Your HR Team

Why, you might ask, would Microsoft even care about HR in the first place? The answer is that increasingly there are two Microsofts: The company that turns out Xboxes, Hololenses, and Surface tablets, and the industrial software and enterprise solution company that makes a lot of money and never gets mentioned on Mashable. Microsoft has realized that they’re not going to be able to get you to buy copies of Windows forever, but they still have a strong customer base in corporations, which will buy bulk licenses for their thousands of PCs. And Microsoft is looking to strengthen that by developing more enterprise software in more places.

Human resources is an obvious choice. Despite what you might hear about the “grey ceiling,” Baby Boomers are retiring off the job market at a steadily accelerating rate. That, in turn, is putting major corporations on the edge of a staggering labor crunch. You’re already seeing it in some industries; you might have noticed your local welding company is increasingly desperate for employees and Texas is facing a nursing home staff shortage because McDonald’s pays better. There are 75 million Boomers in the workforce, and they make up roughly half of all people with jobs.

This isn’t even getting into the rapid greying faced in Europe and Japan, both of which are going to have an increasing need for foreign workers whether they want to admit it or not. So, yeah, things are about to get a little competitive, and Microsoft wants to be on the cutting edge.

What’s The Future Of LinkedIn?

With that in mind, it’s unlikely LinkedIn is going to change very much. If anything, expect it to be worked into your Windows experience more. Instead of Clippy offering up a resume template, he’ll probably push you to upload your resume data to LinkedIn. Also expect LinkedIn to be more closely incorporated into other elements of Windows, much like Bing, which is inescapable. Whether LinkedIn is really worth $26 billion remains to be seen, but expect Microsoft to aggressively follow it up elsewhere. On the bright side, at least you’ve got a bunch of people who want to get you a job, right?

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