Global IT spending to rise to US$4.5 trillion in 2022, says Gartner - MIDA | Malaysian Investment Development Authority
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Global IT spending to rise to US$4.5 trillion in 2022, says Gartner

Global IT spending to rise to US$4.5 trillion in 2022, says Gartner

15 Jul 2022

Global information technology (IT) spending is projected to rise 3% year-on-year in 2022 to US$4.5 trillion (about RM20.02 trillion), according to Gartner Inc.

In a statement on Thursday (July 14), the firm said while IT spending is expected to grow in 2022, it will be at a much slower pace than in 2021 due to spending cutbacks on PCs, tablets and printers by consumers, causing spending on devices to shrink 5%.

Gartner distinguished research vice president John-David Lovelock said inflation is top of mind for everyone.

“Central banks around the world are focusing on fighting inflation, with overall inflation rates expected to be reduced through the end of 2023.

“However, current levels of volatility being seen in both inflation and currency exchange rates are not expected to deter chief information officers’ (CIOs) investment plans for 2022.

“Organisations that do not invest in the short term will likely fall behind in the medium term and risk not being around in the long term,” he said.

Gartner said price increases and delivery uncertainty, exacerbated by the Russian invasion of Ukraine, had accelerated the transition in purchasing preference among CIOs, and enterprises in general, from ownership to service — pushing cloud spending to an 18.4% growth in 2021 and an expected growth of 22.1% in 2022.

It said not only is cloud service demand reshaping the IT services industry, but it is also driving spending on servers to a 16.6% growth in 2022, as hyperscalers build out their data centres.

Gartner said spending on data centre systems is forecast to experience the strongest growth of all segments in 2022 at 11.1%.

Cloud consulting and implementation and cloud managed services are expected to grow 17.2% in 2022, from US$217 billion in 2021 to US$255 billion in 2022, helping to drive the overall IT services segment to a 6.2% growth in 2022.

Worldwide IT spending forecasts (millions of US dollars)

 2021 spending2021growth (%)2022 spending2022growth (%)2023 spending2023growth (%)
Data centre systems 191,001 6.4 212,218 11.1 221,590 4.4
IT services1,207,96612.81,283,1926.21,389,1698.3
Communications services 1,458,527 3.8 1,464,551 0.4 1,505,733 2.8
Overall IT4,401,94410.24,534,6323.04,809,5616.1

Source: Gartner (July 2022)

IT talent crunch

Gartner said the critical IT skills shortage being felt across the globe is expected to abate by the end of 2023, when the corporate drive to complete digital transformations slows down and there is time for upskilling and reskilling of existing staff.

However, it said that in the near term, CIOs will be forced to take action to balance increased IT demand and dwindling IT staffing levels.

The Gartner Global Labor Market Survey of nearly 18,000 employees in the first quarter of 2022 showed compensation is the No. 1 driver of IT talent attraction and retention.

Technology service providers are increasing prices for IT to allow for competitive salaries.

This is driving an increase in spending on software and services through 2022 and 2023.

Worldwide software spending is expected to grow 9.6% to US$806.8 billion in 2022, while global spending on IT services is forecast to reach US$1.3 trillion.

Lovelock said that additionally, CIOs are using more IT services to assist in the lack of skilled IT staff. Tasks that require lower skill sets tend to be outsourced to managed service firms to alleviate staff time, while critical strategy work, which requires high-end skills unobtainable by many enterprises, will increasingly be fulfilled by external consultants.

Source: The Edge Markets