Talent Wars Fuel Increase In Worldwide IT Spend: Gartner

Lisa Johnston
Editor-in-Chief, CGT
Lisa Johnston profile picture
gartner it spending

Worldwide IT spending is projected to grow 4.3% year over year in 2023, according to Gartner’s latest forecast, as CIOs shift spending to automation in part due to challenges with recruiting and retaining tech talent

Global IT spend is anticipated to reach $4.7 trillion, propelled by businesses increasing spend on efficiency-driving core applications and platforms, such as ERPs and CRMs — and from vendors raising their prices. While CIOs may wish to grow their IT teams, the war for talent means today’s businesses are looking for tech that will help them drive growth at scale with fewer workers, the research firm reported.  

“Digital business transformations are beginning to morph,” said John-David Lovelock, Gartner distinguished VP analyst, in a statement. “IT projects are shifting from a focus on external-facing deliverables such as revenue and customer experience, to more inward facing efforts focused on optimization.”

While the software segment is expected to grow double digits, device spending will sink 8.6% this year thanks to the impact of inflation on consumer purchasing power. 

“The devices segment is experiencing one of its worst growth years on record,” said Lovelock. “Even as inflation eases slightly in some regions, macroeconomic factors are still negatively impacting discretionary spending and lengthening device refresh cycles. Devices spending is not expected to recover to 2021 levels until at least 2026.”

Generative AI isn’t yet impacting IT spending levels, the firm said, which expects the gen AI long-game to include its incorporation into existing spending. 

“Generative AI’s best channel to market is through the software, hardware, and services that organizations are already using,” said Lovelock. “Every year, new features are added to tech products and services as add-ons or upgrades. Most enterprises will incorporate generative AI in a slow and controlled manner through upgrades to tools that are already built into IT budgets.”

He noted that while organizations will be fine without having AI in production, developing their AI story and a strategy remains critical. 

This story originally appeared on CGT, a sister publication of RIS News. 

More Like This

  • How Wayfair is Using Generative AI

    Wayfair is experimenting with generative AI for retail and has at least four use cases already underway, according to Niraj Shah CEO, co-founder and co-chairman. Learn more.
  • Three Ways To Win Against the Labor Shortage Using Data and Analytics

    829,000. That’s the number of unfilled retail jobs in the United States, according to The U.S. Bureau of Labor’s May 2023 findings. As any retailer operating in this environment knows, this deficit negatively impacts the customer experience and threatens the bottom line.
  • 10 Best Retail Employers for Women to Work for

    As the fight for gender equality in the workplace continues, some employers are being recognized for their strides. Learn more about the employers supporting women and helping them maintain an acceptable work-life balance.
    women at work