Gartner and IDC predict growth in Worldwide IT spending
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International Data Corporation or IDC lowered 2023 worldwide IT spending forecast to $3.25T, a constant currency growth of 4.4%. This is slightly down from 4.5% in the previous month's forecast and represents a swing from a 6.0% growth forecast in October 2022.
The correction represents technology investments adversely impacted by weakening economy. Forecasts for other hardware categories including servers, wearable devices, and peripherals also remains slashed. The service provider spending still meek owing to slower post-COVID growth. However, cloud services continues to drive growth despite inflationary pressures but non-cloud spending is set to decline.
"Since the fourth quarter of last year, we have seen clear and measurable signs of a moderate pullback in some areas of IT spending," said Stephen Minton, vice president in IDC's Data & Analytics research group. "Tech spending remains resilient compared to historical economic downturns and other types of business spending, but rising interest rates are now impacting capital spending." 
"The most significant impact remains concentrated in consumer markets with consumer IT spending now forecast to decline by 2% this year. This will be a second consecutive year of declining consumer tech spending, a huge change in fortunes from consumer growth of 18% in 2021. On the other hand, enterprise demand for cloud and digital transformation remains strong despite economic headwinds." said Minton.
Gartner's figures follow those from IDC, which similarly forecast a growth in Worldwide IT spending, albeit at a higher pace. 
Gartner forecasts worldwide IT spending to total $4.6T in 2023, an increase of 5.5% from previous year. The software segment could potentially see double-digit growth as enterprises shift to automation and other software-driven initiatives. Conversely, the devices segment likely set for a 5% decline.
âMacroeconomic headwinds are not slowing digital transformation,â said John-David Lovelock, Distinguished VP Analyst at Gartner. âIT spending will remain strong, even as many countries are projected to have near-flat gross domestic product growth and high inflation in 2023. Prioritization will be critical as CIOs look to optimize spend while using digital technology to transform the companyâs value proposition, revenue and client interactions.â
Gartner also highlights that even as tech layoffs are on the frontpage, there is still a critical shortage of skilled IT labor. âTech layoffs do not mean that the IT talent shortage is over,â said Lovelock. âIT spending on internal services is slowing in all industries, and enterprises are not keep up with wage rate increases. As a result, enterprises will spend more money to retain fewer staff and will turn to IT services firms to fill in the gaps.â
Also read: 'Device shipments take a hit in 2022; 4.4% downfall expected in 2023'
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