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What impact will the unfolding livelihood crisis have on the IT sector?


According to Gartner’s latest forecast, global IT spending is expected to reach $4.5 trillion in 2023, representing a 2.4 percent increase by 2022, but compared to a 5.1 percent growth forecast in the previous quarter, this means a significant decrease. While inflation continues to put pressure on consumer purchasing power and device spending, overall enterprise IT spending is expected to remain high.

Global IT Spending Forecast (USD million)

Data Center Systems212 376 213 853
Software783 462856 029
Instruments722 181685 633
IT Services1 244 7461 312 588
Communication services1 422 5061 423 367
Summarize4 385 2704 491 471

“Consumers and businesses face very different economic realities. As inflation hits consumer markets, causing layoffs at B2C companies, companies continue to increase spending on digital business initiatives despite the global economic downturn. A volatile economy has changed the context for business decision making and may cause CIOs to hesitate, delay decisions, or change priorities. We have seen this in practice in the reorganization of some B2B companies, especially those that have overinvested in growth. However, IT spending remains recession-proof”

John-David Lovelock, senior analyst at Gartner, said.

The software and IT services segments are forecast to grow by 9.3 percent and 5.5 percent, respectively, in 2023. Meanwhile, the device segment will decline 5.1 percent this year as both consumers and businesses increase their device refresh cycles.

“At the height of the pandemic, workers and consumers have made technological upgrades to tablets, laptops and cell phones due to remote work and education. Without good reason to upgrade, assets continue to be used and the market suffers.”

Lovelock added.

The vacancy rate is rising quarterly, and the ratio of open vacancies per unemployed person is at an all-time low in many countries. Competition for talent forces CIOs to hire skilled IT professionals, limiting the growth of companies that find it difficult to scale without the talent they need.

As software costs continue to rise, the IT services market is also getting bigger as companies turn to external IT professionals for implementation and support. For example, consulting spending is expected to reach $264.9 billion in 2023, up 6.7% from 2022.

“CIOs are losing the race for talent. Spending on IT services is growing faster than internal services across all industries. Skilled IT workers are moving from corporate CIOs to technology and service providers (TSPs) who can keep up with increased wage demands. , opportunities for development and career growth»

Lovelock says.

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Sandra Loyd
Sandra Loyd
Sandra is the Reporter working for World Weekly News. She loves to learn about the latest news from all around the world and share it with our readers.

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