Global spending on IT consulting is expected to reach USD 264.9 billion in 2023, a 6.7% increase from 2022. As software spend continues to rise, the IT services market is growing as companies look to bring in outside IT staff for implementation and support, marketing and research firm Gartner says in a forecast.
“IT services spending is growing more quickly than internal services in every industry. Skilled IT workers are migrating away from the enterprise CIO towards technology and service providers (TSPs) who can keep up with increased wage requirements, development opportunities and career prospects”, says John-David Lovelock, VP Analyst at Gartner
Inflation continues to erode consumer purchasing power and drive down spending on tech devices but overall business IT spending will remain strong, Gartner says.
Worldwide IT spending is predicted to increase 2.4% to USD 4.5 trillion in 2023, down from 5.1% in the last quarter of 2022.
“Consumers and enterprises are facing very different economic realities,” says Lovelock. “While inflation is devastating consumer markets, contributing to layoffs at B2C companies, enterprises continue to increase spending on digital business initiatives despite the world economic slowdown.”
“A turbulent economy has changed the context of business decisions and can cause CIOs to become more hesitant, delay decisions or reorder priorities. We’ve seen this in action with the reshuffling taking place among some B2B companies, especially those that overinvested in growth. However, IT budgets are not driving these shifts, and IT spending remains recession-proof.”
The software and IT services segments are projected to grow 9.3% and 5.5% in 2023, respectively. The devices segment is forecast to decline 5.1% this year as both consumers and enterprises save money by waiting longer to renew equipment.
“During the height of the pandemic, employees and consumers had technology refreshes of tablets, laptops and mobile phones due to remote work and education,” says Lovelock.
“Without a compelling reason for an upgrade, device assets are being used longer and the market is suffering.”