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IT spending limps along, but better than the last two years: survey

'While corporate revenue has generally been increasing, top management has not been granting commensurate increases in IT spending.'
Written by Joe McKendrick, Contributing Writer on

Anyone struggling to move their IT departments forward within tight budget constraints would not be surprised at the results of the latest IT budget survey: that things are getting better, but it's a slow go.

Sixty percent of companies have increased their IT operational budgets, according to the Computer Economics IT Spending and Staffing Benchmarks study, based on on responses from 200 IT executives in the first quarter of 2011. The study's authors sum up the situation as follows:

"There are indications that the worst is behind us. IT operational and capital spending is rising. The increase is not strong and many IT executives lack confidence in their spending plans, but at least confidence is higher today than during the previous two years."

The median annual growth in IT operational budgets is about 2%, versus 0% over the previous two years, but lower than the 4% rate seen in 2008 and 5% in 2007. The report puts it in its perspective however, noting that "organizations are restraining IT spending," explaining that IT budgets only represented about 1.6% of corporate revenues. "While corporate revenue has generally been increasing, top management has not been granting commensurate increases in IT spending."

Industries showing healthy increases in IT spending include insurance, wholesale distribution, manufacturing, and healthcare providers. Lagging the list are government agencies.

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