New Survey Reveals Insights About IT Business Growth
Back Published 2010-05-10
Oakbrook Terrace, Ill. — May 10
Information technology companies in China and India are notably more bullish on prospects for business growth in the next six months than their counterparts in the U.S., the U.K. and Canada, according to a recent CompTIA survey.
The “CompTIA IT Industry International Business Confidence Index” — based on an online survey of more than 850 IT companies in more than 70 countries conducted in March — finds that business confidence trends are well above the global average among IT companies in China (77 on a 100-point scale) and India (76). Among other countries, Canadian sentiment falls roughly at the average (64), while business confidence among IT companies in the U.S. and the U.K. lags slightly behind the global average.
Confirming the strengthening economies in many parts of the world, the overall index recorded a jump of nearly nine points in March 2010 since the previous reading in October 2009. Looking ahead, IT companies expect further improvements, reflected in their six-month confidence forecast of 68, up nearly four points over the previous reading.
“The IT industry held up relatively well during the global economic downturn,” said Tim Herbert, vice president of research for CompTIA. “This research is another sign the IT industry is well positioned to outperform many other industry sectors over the next year.”
The survey also reveals that after a period of cutting or maintaining costs, a number of IT companies are looking to invest in their business.
“Nearly two-thirds expect to increase spending over the next six months on revenue-generating initiatives such as research and development, while 58 percent expect to increase spending on technology,” Herbert noted.
Though unemployment has been persistently high in many countries, the CompTIA survey data suggests hiring may start to pick up. Among all IT companies surveyed, 42 percent expect to increase hiring in the next six months, with companies in China and India having the highest expectations for staffing increases. But as a sign of the still fragile recovery, 13 percent of all respondents indicate they expect to cut staff in the next six months.
Global IT industry growth is forecast to range from flat, under the most pessimistic scenario, to an increase of 4.5 percent, under the most optimistic scenario. Firms are slightly most bullish on IT services growth, followed by software and hardware. Firms in India see the most upside to global IT industry growth at 5.5 percent, while Canadian firms express the most concern.
Perceived threats to economic growth vary by country, the survey indicates. U.S. IT companies are relatively more concerned about weak consumer demand, while firms in the U.K. voice concern about weak corporate demand. China is concerned about exports and India about domestic competition. Canadian companies believe a general lack of confidence could inhibit growth in their market.