UK to lead the way as Europe recovers from slump in IT spending

After a few years of slow or negative growth, the European IT economy is slowly recovering and the UK is leading the way.
Written by Colin Barker, Contributor

It seems that after a long, grim period of recession, the European economy is slowly recovering with analysts predicting a modest 2.3 percent rise in tech spending in 2014.

The star performer this year is likely to be the UK with a predicted growth of 4.9 percent in comparison to Germany, where the analysts only expect 1.2 percent growth. The outlook for France is even bleaker, with growth of just one percent predicted.

There is better news ahead though, according to analyst house Forrester, which is forecasting a rise in tech spending of five percent next year.

Looking at the detail, software spending will see the highest increase in 2014 across Europe, with customer-facing technologies for sales and marketing, mobile and analytics technologies as well as big data most in demand.

But Forrester is also predicting that the market for computer equipment — with the exception of tablets — will remain weak which is in line with the analysts overall uncertainty about whether 2015 will bring sustained growth or just a lurch back into recession.

"The risks of a renewed recession triggered by deflationary forces remain real," said Forrester analyst Andrew Bartels, "so CIOs should be cautious in their 2014 tech spending plans and be prepared to reverse course if necessary."

Through 2014 the Central and Western Europe's tech market will be €568bn, compared with the €900bn tech market of the Americas and €527bn for Asia Pacific. The largest two country markets in Europe — the UK and Germany — remain in fourth and fifth place after the US, Japan, and China.

All technology categories are seeing increases. Software will rise by six percent and communications equipment by five percent, while IT outsourcing and IT consulting spend will rise by seven and five percent respectively.

Further reading

Editorial standards