Enterprise IT Spending In The States To Improve In The Second Half
March 11, 2013 Jenny Thomas
It’s always nice to have something to look forward to. In the U.S., the recession we have been stuck in for what seems like forever has left us with a seemingly endless view of bad news including continued high unemployment rates, a failing housing market, skyrocketing gas prices, and a looming fear of the fiscal cliff among the many issues we had staring us in the face.
But out on the horizon, the experts at IDC see a glimmer of change in our not-too-distant future. In its recently released United States Black Book 4Q12, IDC updated its forecasts for IT spending across 15 vertical markets and all 50 states and the District of Columbia. Black Book 4Q12 reveals that the U.S. economy is expected to stabilize in the second half of 2013, leading to moderately strong IT spending growth.
The bottom line is total IT spending in the United States on hardware, software, and IT services across all 15 enterprise industries is forecasted to grow by 6 percent in 2013, to approximately $474 billion.
IDC cites global uncertainty as a key reason that businesses have been unwilling to expand IT budgets. Members of the IT community are all too familiar with the watch-and-wait budget, as many companies have stopped spending in an effort to ride out the current financial storm. But the IDC is predicting continued investments by companies as they begin to prioritize the replacement of outdated technology, and pursue strategic IT initiatives focused on big data and analytics, cloud computing, and mobility.
One interesting revelation in the most recent IDC Black Book is where the spending is expected to occur. The reason it is interesting is because they’re talking about is on the map, not in the data center.
“We expect total IT spending by enterprises in Arizona, North Dakota, Utah, and Texas to grow at the highest rates in the country over the next year at more than 7 percent across all industries,” said Natasha Menon, a research analyst at IDC. “This growth is being driven by a high percentage of healthcare, manufacturing, and professional services businesses in these states and IT spending aligns with economic projections of employment growth in these industries.”
Black Book 4Q12 also discusses specific industries that are expected to grow at above-average rates this year. Healthcare continues to be a place where big growth is expected, with a forecasted increase of more than 8 percent in 2013, due in part to the need to process and analyze increasing volumes of data from new clinical systems. Professional services are also expected to make a good showing with a more than 8 percent increase. The reason? IDC analysts have found a high correlation between overall corporate profitability and IT spending by professional services firms, which suggests robust spending within this industry as corporate profits are forecasted to improve.
For the curious, the 15 industries covered in the Black Book are:
Every quarter, IDC releases its United States Black Book: State IT Spending by Vertical Market, which reviews the status and projected growth of the IT industry in 50 states, segmented by 15 vertical markets as well as 15 technologies across hardware, software, and services. The data is based on IDC’s Worldwide Black Book, which forecasts IT spending in 54 countries around the world, focusing on 25 individual market segments across hardware, software, IT services, and telecom services.