Federal govt shutdown hits U.S. IT spending

Federal govt shutdown hits U.S. IT spending

Summary: Forrester now sees 2013 IT growth of 3.9 percent, down from 5.7 percent. Thank your clueless Congress.


The Federal government shutdown, budget issues and Congress' inability to get its act together has cut technology spending growth by about 2 percent in 2013, according to Forrester Research.

Forrester now sees 2013 IT growth of 3.9 percent, down from 5.7 percent. For 2014, Forrester projects IT spending for business and government in the U.S. to rise at a 5.3 percent clip.

In a nutshell, any tech vendor who has a heavy federal government component of revenue saw deal flow slow down. The Federal government uncertainty has also filtered into the private sector.

Andrew Bartels, Forrester analyst, said in a blog post:

The effects of reduced Federal spending have flowed into the private sector, purchases of computer equipment have also slumped, as cautious CIOs dial back their spending on these easily deferred categories of the tech budget. Servers and PCs have been especially hard hit as alternatives like infrastructure-as-a-service (instead of buying servers) and tablets (as replacements for laptops) accentuated CIO caution. However, there is evidence that even corporate purchases of tablets have slowed in 2013 as the initial rush to put these new devices into the hands of employees has been way to a more measured adoption curve.

The good news is that business purchases of software will grow at a 6.2 percent clip in 2013, said Bartels. Licensed on-premise software has taken a hit, but mobile applications have gained momentum.

forr 1028


Topics: Tech Industry, Government

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  • Your clueless and/or care-less president

    You can thank your clueless and/or care-less president for being willing to shut down the govt rather than engage in meaningful conversation about the disaster of the decade known as Obamacare.
    • Wasn't the "meaningful conversation" done before Obamacare was made law?

      Correct me if I'm wrong, but wasn't Obamacare passed into law months ago? You know, before the 49(?) failed attempts to repeal Obamacare.

      If one party is allowed to shut down government every time a law is passed they don't like, what is the use of passing laws, or of government at all?
      • You mean the meaningful conversation

        where the supermajority shut down debate in the Senate.

        where the people voting on it weren't given enough time to read it, much less understand it.

        where the Senate version was taken and replaced the contents of an unrelated House bill so that it would have "originated in the House" (which is arguably unconstitutional).

        where not one member of the opposing party, *not even one*, voted for it (but now you want them to vote to fund it).

        where the President insisted over and over the mandate was not a tax -- until, of course, it came time to fight the constitutionality of the mandate in court.

        where everyone gets to keep their plan and doctor if they want (oh, wait...).

        Those meaningful conversations?
      • You're Wrong

        It was made law on partisan lines. The majority of America didn't want the law. This is why we have so much conflict now. BTW, it was two a$$holes that shutdown the government Reid and Obama, all because they refused to negotiate on a simple one year extension that was already given to business.
      • It's called checks and balances

        And it's called representative government. If people decide they don't like a law, they can have their elected representatives use whatever means allowed in the Constitution to overturn that law, including the power of the purse. It's precisely to avoid government abuse, like idiotic comments such as "we need to pass it to know what's in it, and a corrupt Supreme Court justice pretending a fine is a tax and ignoring the clear limits of government in the Constitution to uphold the law.
        • RE: It's called checks and balances

          I agree completely. My take on what has happened is that our two party system has subverted the check and balance approach. The rank and file politicians need to go. I don't want any politician voting with their party because it is the idea of their party. Our government is about as corrupt as it could be without inciting a revolt from the masses. Although we seem to be letting the government get away with more and more these days as we get used to the out of control government.

          There is more in common with the libertarians and the true progressives then a lot of people might think, at least at it relates to governmental power. When it comes down to it, all we disagree on is how we get something done and who is responsible.

          When it comes to politics every citizen needs to be a critical thinker and wonder, why this goal, why this approach. It is often has a lot to do with the power and finances of the politicians and their supporters then for this nation. We all know the masses ('those other people') want to be told what to think and do, 'they' latch onto catch phrases and exaggerations. Flat out they are all lying to us for their benefit.

          I want a new checkbox at every election for every branch of government to eject all elected officials and spark new elections without the current players in the mix. A vote of "no confidence" if you will.
          So we don't like congress at the state/federal level? Vote to flush them all and start over.
          Don't like elected judges? Flush them all.
          Don't like the executive branch? Don't just vote for the 'other' candidate, flush the one we've got and start over.
          That would never pass though.....because a politician would have to allow a vote of no confidence to begin with by the people.....
        • Nevertheless

          The U.S. Constitution created two almost entirely coequal houses of Congress. Unlike in the UK and many other countries, the lower house does not have the authority to pass or repeal laws over the objections of the upper house, nor should it. To that extent, I think that use of the appropriations process to force de facto repeal of acts of Congress is wholly illegitimate. By the same token, I would oppose an effort to withhold funding until/unless the President and Vice President both resigned as contrary to the spirit of the Constitution, which very intentionally established an independent executive.

          The House of Representatives on near party line votes has repeatedly passed bills to repeal the ACA; it was within its authority to do so. The Senate either rejected or declined to consider those bills; it was within its authority to do that. The House passed a continuing resolution at the last minute to fund the entire federal government, except for implementation of the ACA; the Senate was under no obligation to go along and didn't.

          But just because someone is authorized to do something doesn't mean he should, and it's manifestly obvious to me (though apparently not to you) that a majority of the members of Congress of both houses and both parties put party loyalty ahead of the public interest. I therefore accept Larry's and David Gewirtz's characterization of Congress as clueless. I have gone further and said that those members who have consistently voted with their parties on budget issues during the current Congress are unfit to hold public office and should be rejected by the voters. I completely reject the contention that one party is the Good Guy Party in this case and the other is the Bad Guy Party. Rather, those who were trying to work out a compromise before the crunch and to get a budget and appropriations bills passed in a timely mann
          er were the good guys, and those who obstructed those efforts for strategic reasons were the bad guys (and we can all do our own research to determine who is who). I intend to vote accordingly and encourage all others to do the same.

          Both parties are equally guilty; vote for and against individuals instead.
          John L. Ries
          • One further thought

            It's plain to me that the budgeting process established by the Budget Act has been broken for 30 years or more and is highly unlikely to be fixed. I therefore propose that it be repealed outright and that we return to the old system of simply passing appropriations bills (as Congress had been doing since 1789). I would therefore propose a joint resolution of Congress with the following provisions:

            1. By March 4 of each year, the President would present to Congress estimates of revenue assuming current law remains in place; good faith estimates of expenses for each federal agency to implement their current legal mandates; proposed spending limits for each agency; and optionally, proposed changes to existing laws.

            2. Appropriations bills could not include substantive legislation (to include changes to existing tax or borrowing authority) and could not fund more than one department or agency.

            3. If Congress appropriates more money than there is available revenue, the President would have the authority to order agencies under his supervision (nearly all of them) to reduce spending below appropriated levels in order to "balance the budget". If funding all agencies and programs at appropriated levels would cause the federal government to exceed its borrowing authority, he would be required to do so. Appropriations bills which purport to restrict the President's authority to do the above would be out of order.

            4. The existing budget and reconciliation processes mandated by the Budget Act would be abolished.

            The currently mandated processes would be great if they were followed, but they've become just another way for politicians to game the system.
            John L. Ries
          • Another provision...

            If Congress fails to pass appropriations bills funding all federal agencies for the next fiscal year by April 30, Both houses of Congress would be required to be in session 10 AM to 4 PM, Monday through Friday (excluding federal holidays) until all appropriations bills have been enacted.
            John L. Ries
  • Moron!

    Federal spending is out of control, so calling the Congress clueless for bringing attention to the matter is really a self serving point of view. If the project is really needed then I would assume that spending will happen for the project. Let's face it, the government wasted countless millions on the Obamacare site and that thing is a freaking mess. Cut the silly spending at the federal level and allow the money to flow into the private sector where it can gain velocity and employ far more people than any government spending will ever do.
  • What will you next blame on the 3'ish week paid vacation "shutdown"

    How about Solar Flares ( ooops - not - Obanacare is going to use that one next ), On most Federal procurement cycles that take years to budget and fund you want to blame this alleged shortfall ( based on what ??? ) on a Sept. 3 week hiatus of the Federal Juggernaut. Don't shift the blame if any from the Obama conceived sequester ( which they keep trying to somehow pin on someone else - sorry the ink is dry on that one).

    Nice try but NO CIGAR !!!!
  • The new norm

    crying that spending isn't growing out of control as much as last year, wow how irresponsible.
  • Clueless voters!!!

    I'd say the "clueless contingent" is the voting public. I was chatting with a low-information, college-educated, 32 year old Democrat who doesn't understand debt, deficits, inflation, marginal tax rates, or global trade. She doesn't understand why the government shouldn't just take over not only healthcare, but also banks, telecommunications, and energy. I asked her if the government should run Apple (as she was paying for her espresso with her iPhone) and she said that was a dumb question. Perhaps, but how do you communicate with such an imbecile about the long-term implications of the out-years of $70-80 trillion in government liabilities on Medicare and Social Security? She obviously wants to raise taxes at all levels, but can't make the connection between capital markets, risk and those who take the risks that lead to iPhones, Starbucks, Amazon.com, Facebook, and Lady Gaga. Perhaps she's predisposed to believe what the POTUS evangelizes, no matter how unrealistic (and fallacious) it all is, and how damaging his evolving legacy is regarding economic growth, healthcare innovation, foreign policy (never has our reputation been so tattered), et al. But she is a part of the governing majority; oh my....
    • The traditional manner of correcting supid voting behavior...

      ...is giving the voters the consequences of their decisions. If the minority then prevents the majority from doing anything of consequence, then how can the majority be held accountable?

      The law was passed. If there are problems in the law (and I think there are lots of them), the proper approach is to point them out as they become obvious, instead of trying to prevent the law from going into effect at all. As it stands, Democrats are in a position to claim that the ACA would have worked fine if Republicans hadn't interfered.
      John L. Ries
      • The Republicans tried!

        Forty Nine times the Republicans signaled issues to the Senate and the Administration. They didn't listen, now people are getting screwed by Obamacare. Maybe it's time for the Democrats to put their big boy pants on and negotiate for items that could actually lower healthcare cost.
        • The House should be allowed to repeal laws unilaterally?

          Sorry, but the system doesn't work that way (this isn't the UK).
          John L. Ries
          • And...

            ...the Republicans could still appeal to the voters in 2014. Who knows? If they can make their case, they might get a Senate willing to go along with repeal in 2014.

            Just remember that every weapon you use can and will be used against you. You do want the next Republican president (and there will be one) to be able to govern, don't you? You don't really want the Democrats to obstruct previously passed Republican bills, do you?
            John L. Ries
          • Yes, the system DOES

            work that way. By design. It's a check on government, deliberately put in the Constitution (the power of the House, the People's representatives, to control the power if the purse).
          • Who said that?

            There is no attempt to repeal unilaterally. The Republicans are working through a legitimate political process, which is legal and constitutional. The current shutdown was bad tactics, but not unprecedented (Democratic Speaker shut the government down somewhere between 12 -14 times). The thing you need to understand is Obamacare (yes I know it's ACA, but my label is meant to be a pejorative) subsumes consumer choice with heavy mandates from the federal government. That's a wholesale restriction on freedom. It's VERY akin to "taxation without representation". And YOU need to understand that we can NOT live with this law as is.
          • de facto repeal...

            ...is still repeal.

            Admittedly, we don't repeal many laws any more; it's deemed much more effective to try to block their implementation and/or enforcement. The game has been going on for a long time, is practiced by politicians and activists associated with both major parties, and does a great deal to reduce respect for both the rule of law and our political system.
            John L. Ries