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IT advances to drive lots of job cuts, Gartner predicts

By Thomas Hoffman
October 7, 2002 12:00 PM ET

Computerworld - LAKE BUENA VISTA, Fla. -- The good news, according to Gartner Inc. prognosticators, is that technology is going to continue to help companies become more efficient.
The bad news is that it could cost you your job.
Gartner said it expects successful companies buoyed by a stronger economy and continued advances in technology to lay off millions of employees starting within the next two years. That was part of a top 10 list of IT predictions that the Stamford, Conn.-based consulting and market research firm released today at its Symposium/ITxpo 2002 conference here.
IT systems that further automate existing manual operations will "substantially lower the labor load of business," said Carl Claunch, director of research at Gartner. Claunch added that IT productivity is likely to outpace corporate revenue growth on an average basis, providing an additional impetus for the downsizing of many workforces.
The job-cutting forecast was No. 4 on Gartner's top 10 list. The other predictions that Claunch made on behalf of the firm were:
1. Adding bandwidth will become more cost-effective than buying new computers. Optical bandwidth capabilities are increasing by 100% per year, while computing capacity is rising by just 60% annually, Claunch said. This will ultimately result in fewer, more centralized data centers and more sharing of computing facilities between companies under an application service provider model, he said. In addition, a growing range of distributed applications will emerge that make use of grid computing, such as sophisticated systems that support pharmaceutical drug development.
2. Most major new systems will be interenterprise or cross-enterprise systems. Technology that lets companies tie together their supply chain systems and other applications will take off, Claunch said. However, that will create what he described as a "pit of snakes." For example, IT managers will have to figure out how to cost-justify investments in such systems.
3. Despite the complexities, interenterprise systems will provide a macroeconomic boost to companies. Many users will be able to leverage cross-departmental and cross-company systems to react more quickly to changing business conditions, according to Claunch. "This will have a clear and recognized effect on productivity,", he said.
5. The consolidation of vendors will continue in many segments of the IT market. Business pressures and constrained IT spending will continue to hamper service providers, network operators and vendors of middleware and systems and network management tools. Half of today's software vendors will be gone by 2004, Claunch said.
6. Moore's Law will hold true through this decade. Claunch said continued technological advancements in areas such as nanotube transistors and storage in nanometer holes will make



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