IT Spending Growth, Hiring Remains Sluggish: Report

eWeek: A new survey by research firm Computer Economics finds that IT budgets and hiring remain subdued. Two-thirds of IT managers surveyed expect larger budgets this year, but a quarter expect IT spending to decline. Similarly, while 40 percent expect to increase IT staff headcounts, 27 percent expect staff reductions. “There appears to be a rising disparity among organizations,” the report said. “Some are prospering while others are still pulling back.”

Even though some IT budgets are increasing, the survey found that managers’ attitudes were more pessimistic than they’ve been since 2009. “Nearly half of IT executives find their budgets are inadequate to meet the needs of the business. The meager growth in IT spending has not restored IT budgets, and many IT organizations remain underfunded due to cost cutting. We believe this is unsustainable and, therefore, a potentially bullish indicator for IT spending in the years ahead,” the report noted. “Business leaders are not aggressively making strategic investments in innovative technologies to gain competitive advantage, at least to the degree that IT spending would rise faster than revenue. Nor are businesses struggling with deteriorating revenue, which can also cause this metric to rise temporarily, as it did in 2010.”