IT budgets forecast to rise in 2023
A new report has indicated that companies are poised to increase their spending on IT next year, despite fears of a recession. The 2023 State of IT report, from Spiceworks Ziff Davis (SWZD), surveyed nearly 1,000 IT buyers and found that, despite 83 per cent worrying that a recession could hit their business next year, slightly more than half were planning to increase their IT spending.
Just 6 per cent of respondents said they were planning to cut their IT budgets, while among companies that were planning cuts to their overall spending, 68 per cent were planning to increase their spending on IT.
Approximately 40 per cent of planned budget increases will be as a result of rising inflation, but the majority of increased IT spending will be as a result of firms needing to replace old hardware, the growing importance of IT projects, security concerns and employee growth.
Jim Rapoza, Vice President and principal analyst at SWZD subsidiary Aberdeen Strategy and Research, said that increased spending was being driven by the impact of COVID-19. He commented: "Businesses that invested in technology during the pandemic saw significant benefits. Our research revealed improvements across performance, reliability, security, and even reduced overall IT costs among organizations that modernized their infrastructure — even if it was initially out of necessity.”
With many firms that invested heavily in IT during the pandemic having thrived, Rapoza said that businesses had begun to view investment in IT as a key strategy for driving future growth.
However, as more businesses return to offices, spending on cloud products is forecast to decline next year, with spending on managed services set to increase. The report stated: "After businesses spent the last couple of years modernizing, many are likely now turning to services to help them maintain their new technology stacks.”
The report concludes that COVID-19 served as a lesson to businesses about agility, highlighting the importance of IT spending and transforming how IT is valued in the workplace.
