CIO survey: IT spending rebounds in June

Computerworld - IT spending forecasts rebounded in June, following a sharp decline in May, according to the monthly CIO Magazine Tech Poll.
CIOs predict IT spending will grow 6% during the next 12 months, vs. 4.8% in May and 8.2% a year ago, according to the survey.
"The spending forecast seems to be stabilizing in the 6% range, up a little bit from last month," said Gary Beach, group publisher at CXO Media Inc. "What's interesting is last May we had a forecast of 8.2% and now it's 6%. That's down almost 25%."
Security remains the area where most CIOs (52.5%) expect to increase spending over the next 12 months, while 49.5% said they plan to increase storage spending.
When asked to compare IT spending now vs. one year ago, 51.1% of the CIOs surveyed believe IT spending is stronger in 2005 than it was in 2004, while 20.1% of the CIOs view IT spending as weaker than a year ago, and 28.8% consider IT spending the same as a year ago.
Beach said he was shocked that CIOs in the financial services sector said they plan to decrease IT spending by 1.2% in the next 12 months.
"The lead-dog vertical category has always been financial services," Beach said. "IT people in those categories are early adopters, and they spend lots and lots of money. I was somewhat shocked by the numbers this month. There's something happening in the financial services industry that accounts for why they're cutting back spending in a significant fashion."
This may be the first time that the financial services category has reported negative growth for the coming 12 months, he said.
June results also indicate that 41.8% of panelists plan to increase spending on computer hardware, down from 45.1% in May, while 24.2% intend to decrease spending, compared with 21.4% in May.
"Another subline in the report -- and we've been calling this now for a year -- is that the IT labor market, overall, went up to the highest level we've seen since 2001," Beach said, "17.4% of CIOs are overall saying IT labor is hard to find and keep. That's up from 14.8% last month," Beach said. "And 35% of the CIOs at the very large companies are saying IT labor is hard to find and keep."