My first resource that I have posted in a while. This was originally intended to be posted some time ago but I figured I should wait until the release of 3.2, and consequently epic gems, so I wouldn't have to rewrite it to cover the new content.
A good place to start I feel is to give a layman's overview of gemming and jewelcrafting in general. Jewelcrafting was the new profession added with The Burning Crusade expansion (similar to Inscription in Wrath); a new profession that was widely considered the single best profession at the time. Not much has changed in fact: after numerous nerfs (including in 3.2) it is still extremely valuable for the bonuses it gives as well as the fact that it can be extremely lucrative in regards to making money off of it. Gems can be of 3 pure color types (Red, Blue and Yellow) and 3 hybrid color types (Purple, Green and Orange). The pure types offer benefits to a single stat, whereas the hybrids offer lesser benefits from the two color classes they draw from (eg: Orange, a mix of Yellow and Red, will provide a combination of the benefits from both a Red and a Yellow gem). Gems are installed in 'sockets' in gear, which also have a color designation of either Red, Blue and Yellow. Most sockets provide a 'socket bonus', a benefit you will receive for matching the gem and socket colors. For example, inserting a Blue gem in the commonly used [Wyrmrest Necklace of Power] would benefit you with the +5 Spell Power socket bonus, which a Red or Yellow gem would not provide.
I get asked about gemming quite a bit, which is surprising for me. Gemming is a relatively simple process for casters in general and we are no exception. Stacking our most valuable stat, Spell Power, is what the whole gemming process comes down to. For this, the [Runed Cardinal Ruby] is optimal; a Red, purely Spell Power based gem. Most of your gear should be studded with these if you are a serious raiding elemental shaman.
The other key consideration is our Meta socket. These sockets are located in head pieces. All tiers sets now have Meta sockets in their head slots as well as most epic quality level 80 head pieces. For us, the best Meta gem is the [Chaotic Skyflare Diamond] (there is no epic quality meta gems as yet, even going back to TBC-era). People have questioned this, as the [Ember Skyflare Diamond]'s +25 Spell Power would subscribe more to our theory of SP stacking. However, the bonus to Critical Strike damage is far, far more beneficial than the +2% Intellect as we should never be mana-starved and in need of the additional intellect. Additionally, the crit damage is a huge factor as we should be critting upwards of 35% of the time in a raid situation. 3% Increase to 35% (or, in most cases, more) of our damage simply trumps the benefits offered by the Spell Power over the Critical Strike Rating.
The issue with this conclusion is that the Chaotic Skyflare requires 2 Blue gems to 'activate' (i.e.: to provide its benefits). This doesn't support our stacking the Red SP gems, so we unfortunately have to go against our policy and add a couple of Blues in the most optimal fashion we can. The Blue gem you choose to use is fairly open. Luckily, the hybrid color gems that feature Blue traits (i.e.: Green and Purple) also work to activate the Meta so we can at least get some Spell Power benefit from these less optimal gems. The general consensus is to go with SP/Stamina combination gems, [Glowing Dreadstone] would be the best option here. However, I have seen good elementals elect for SP/Spell Penetration ([Mysterious Dreadstone]) or SP/mp5 ([Royal Dreadstone]) also. Basically, as long as it is has Spell Power it is reasonable and we accept that there will be little to no benefit gained from the gem's other stat.
A factor I see many shaman failing to recognize is the placement of the Blue gems. Most accept that these B-grade gems have to be there so they slap them in the first two places they see. If you search for a place where it can be used to also activate a socket bonus (either by itself or teamed with one of our Red gems) it gives at least slightly more benefit then it would otherwise. For example, my two Blue Gems are in my t8.5 [Conqueror's Worldbreaker Headpiece] and my [Lightning Grounded Boots]. This way, I integrate the gems in and can still activate their two socket bonuses giving an additional +16 Spell Power. Being aware of small opportunities such as this do add up in the long run and help you get the absolute most out of your DPS ability. Keep your eyes open for things like this in all facets of your gear orchestration; do not completely ignore socket bonuses.
I hope this has made the topic of gemming a little easier for you all to wrap your head around. Best of luck, and happy hunting.