Computer Economics Forecasts Anemic Growth in 2008 IT Spending

Business Wire, Nov 13, 2007

IRVINE, Calif. -- Large organizations are pulling in the reins on IT spending growth, according to a Computer Economics survey of 125 IT decision-makers in the U.S. and Canada.

Although 66% of respondents expect budget increases next year, the size of those increases--only 2.5% at the median--are relatively conservative when compared to the rising growth rates over the past three years.

"If these expectations prove accurate, this will be the lowest rate of growth in IT spending since 2004," said Frank Scavo, president of Computer Economics, an IT research firm based in Irvine, California.

The survey results (a year-end update of the company's annual IT Spending, Staffing and Technology Trends study) indicate that spending overall held up well this year against the planned 5% growth in IT spending for 2007. However, among large companies, there are signs of cutbacks: Thirty-three percent say they will spend less than budgeted, while only 22% indicate they will spend more.

Looking toward 2008, companies are anticipating smaller budget increases. Large organizations, again, were the most conservative. The median anticipated budget increase is 2% for large organizations.

"Our survey data indicates that IT executives have already scaled back their expectations for IT spending increases in 2008. If economic conditions worsen, we expect that median IT spending increases in 2008 will be flat compared to 2007," Scavo said. "We do not yet, however, see widespread IT spending cuts in 2008."

For the full report, 2008 IT Spending Outlook: Anemic Growth, visit the Computer Economics website at www.computereconomics.com.

About Computer Economics

Founded in 1978, Computer Economics provides original research and advisory services on the strategic and financial management of information technology. The firm's clients include IT end-user organizations and major consulting firms. Its monthly newsletter, the Computer Economics Report, first published in 1979, provides decision-makers with timely insights into the management of information systems. Its IT Spending, Staffing and Technology Trends study, published annually since 1990, is the definitive source for IT spending benchmarks and related metrics. Computer Economics publications are available from its website at www.computereconomics.com.