IT Budgets Are Sliding, But Not Drastically

Jan. 9, 2009

Only 35% of U.S. and Canadian organizations surveyed in 2008 reacted to the stock market turmoil by cutting IT operational spending.

Dave Blanchard

The financial crisis, not surprisingly, has had an impact on companies' IT budgets and staffing levels, although the impact so far appears to be minor. According to research firm InfoEdge, 35% of U.S. and Canadian organizations surveyed in the fall of 2008 reacted to the stock market turmoil by cutting IT operational spending. The majority of the firms, however, made no change at all, while 11% increased their IT spending between August and October.

Overall, InfoEdge expects that IT operational budgets will grow at their slowest rate since 2004, when growth coming out of the previous recession was similarly flat. IT operational spending growth peaked in 2007 at 5.0% and then declined this year to 4.0%, according to InfoEdge.

Percentage of Organizations Changing IT Operational Budgets
(Aug-Oct. 2008)

Industryweek Com Media News Items 18183 It Budgetsgraph

Source: InfoEdgeSimilarly, analyst firm AMR Research expects IT spending growth of around just 1% in the coming year, based on its survey of manufacturing and service executives.

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