A fresh report on IT spending finds that technology budgets of firms in the petroleum, mining and energy industry will grow more during 2002 than any other sector, by about 15.9%. On the other end of the spectrum, the sharpest declines will be among manufacturers of non-durable goods (a range of retail merchandise, grocery, apparel and other products) which are expected to cut IT spending by 15.1% this year.
The report from analyst firm Gartner Inc. and investment bank Soundview Technology, released Tuesday, charts the expected rise or fall of tech spending across 18 industries. The survey of 1,048 IT execs across all industries (representing $35 billion in tech spending), finds that 60% of IT executives expect to spend more on technology this year than last year; 40% expect to spend less.
Of the remaining 16 industries charted, those expected to spend more on IT this year than last year are: agribusiness, fishing and forestry (10%), business services (7.8%) media/entertainment (7.6%), distribution of logistics services (7.1%), financial services (5.0%), retail trade (4.4%), healthcare (3.6%), education (3.4%), non-profits (1.9%) and research and development (1.7%).
Industries where IT spending is forecast to drop are: durable goods manufacturing (-0.2%), wholesale (-0.4%), transportation (-1.6%), government (-3.6%), utilities (-3.7%), and all manufacturing (-6.2%).
The report highlights the shifting priorities and the shifting demands for IT products and services among the major vertical industries. “Last year, user priorities were dictated by the question, `Which of these new projects can we do without?’ In 2002, a new question will determine the shape of IT spending: `What do we need to do to be safe no matter what happens?'” says Arnie Berman, chief technology strategies at SoundView Technology.
An earlier report by Gartner and SoundView found that the tech sectors that are most likely to attract more spending in 2002 are security, Web-based applications, PDA and Web integration services. Low on CIOs’ priority lists are mainframe, contract labor services, and desktop products and services.
The Gartner/SoundView report is the latest in a string of recent columns and articles on CIN related to IT budgets and spending. For more on the subject, follow these links:
Time for IT to Rise from the Ashes?: Coming off the first-ever year-to-year drop in U.S. IT spending, there’s no lack of research predicting 2002 will be a better year to be in the technology business.
Despite Banks’ IT Spending, Productivity Gains Lacking: A McKinsey & Co. report finds that amid heavy spending on CRM and other service-oriented projects, banks’ productivity growth rates have declined.
The Roundup: Did Somebody Say IT Predictions?: A top-10 list for the IT industry in 2002, plus reports on enterprise conferencing, wireless advances and why e-retailers are smiling.
See How They Spend It: As their budgets hold steady or fall, IT execs are helping their companies achieve growth through a smarter use of IT dollars. Here are some strategies in action.
Enterprise CRM Spending Seen Stagnating: Corporations are conserving cash and looking for bargains when hunting for CRM technology, according to report.
IT Spending to Rebound Slightly in 2002: Finding consensus with others’ predictions, Giga Information says spending will rebound 4% next year after falling 5% in 2001.
2002: New Goals for IT Investment: After a lull in spending, CIOs are seen focusing on projects that yield cost savings, such as consolidation of servers and applications.
Report: IT/IS Spending Bottoms Out: A new CyberAtlas Research report suggests that spending on IT/IS has hit bottom and will begin to rebound in 2002.