After years of stagnation during the recession that began in 2008, there may be good news for the makers of IT infrastructure: companies may start spending again next year.
In reality, they began spending more in 2012, according to a new study, but the pace is expected to pick up in 2013, according to the results of a DATA, Inc. survey of IT professionals.
Ironically, there is some evidence that recessions incite an increase in some sectors of the tech industry. According to a New York Times article published last month, recessions force important changes in how business gets done. Historically, that is the kind of pain that also means renewal, and long-term economic growth.
Companies may, for example, use their precious dollars during a recession to invest in technologies that improve the productivity of existing employees to avoid having to hire more. In the call center industry, economic low points have often led to booms in call center technologies perceived to help companies make more out of less – workforce optimization solutions, for example.
To be blunt, there’s only so much technology budget cutting a company can do if it hopes to stay in business, and U.S. companies may have reached the extreme limits of cutting, meaning it’s time to shell out, particularly in light of new regulations with which companies must remain compliant.
Analyst group Gartner recently noted that “most enterprises have already significantly cut discretionary IT spending growth over the past several years,” and that “they have little room to reduce IT spending further over the long run.”
So while the nation – or the world – isn’t completely out of its economic doldrums, this doesn’t mean that technology spending will continue to be depressed. The DATA, Inc. survey seems to jive with this conventional wisdom: 68 percent of study respondents said their IT spending increased in 2012, and that investments were made in areas such as infrastructure (noted by 58 percent of participants), application support services (57 percent) staffing and custom application development (both 44 percent).
Surprisingly, bringing up the rear was mobile application development with just 34 percent of respondents reporting a significant investment in that area.
These expected spending increases are true for a variety of industries, from financial organizations to public sector entities.
“The survey results show positive trends for the information technology industry,” said Arun Verma, CEO and president of DATA, Inc. “I’m sure many IT executives are still cautious about their spending, but a variety of issues – from new regulations to new technologies and the need for efficiencies – are driving many technology investments.”
Certainly, the IT industry could use some good news, and this may be it.
Edited by Braden Becker