Tech and IT spending to see a downfall this year: IDC forecast
In terms of technology, the hardware segment is expected to see the sharpest decline. The spending for the particular segment is predicted to decline more than 5% this year.
As per the latest forecast report by IDC, the worldwide IT spending will decline 2.7% this year due to the economic impact of the Covid-19 pandemic. The reports states that hospitality and tourism-heavy industries like transportation and personal and consumer services will be the most negatively impacted markets with regards to IT spending. The spending is expected to decline by 5% or more for these sectors. But while these are relatively small markets, the larger ones that will be impacted are Discrete and process manufacturing for technology. These together make a $400 billion market and are expected to witness decrease in spending by 3% this year.
On the other hand, some "recession resistant" industries like government are expected to spend more this year. The health care and telecommunications industry are also expected to see increase in spending. "IT spending in the healthcare and telecommunications segments are also forecast to grow slightly as they respond to new demands presented by the pandemic. Professional services will see the strongest growth in IT spending this year with an expected year-over-year increase of 1.7%," states the IDC forecast report.
"While industries that offer digitally-enabled or critical services offer some bright spots, those industries that rely on physical products, an in-person presence, or provide luxury services are struggling," said Jessica Goepfert, program vice president, Customer Insights & Analysis.
In terms of technology, the hardware segment is expected to see the sharpest decline. The spending for the particular segment is predicted to decline more than 5% this year as companies pull back on most near-term infrastructure investments. Also mentioned is that IT services and business services are likely to witness "moderate reduction in spending as companies focus on keeping their existing operations and mission-critical projects going." However, software segment will be a bright spot in technology spending with growth of nearly 2% due to purchase of collaborative applications and content workflow.