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Survey: U.S. IT spending forecast worst since 2001

45% plan to spend less on IT in Q1 '09

By Chris Kanaracus
November 20, 2008 12:00 PM ET

IDG News Service - Forty-five percent of respondents to a new survey from ChangeWave Research said that their companies will spend less money or nothing at all on IT during the first quarter of 2009. That's the highest percentage of ChangeWave survey respondents to answer that way since 2001.

ChangeWave surveyed 1,926 people in the U.S. involved with IT spending at their organizations. The study was conducted Nov. 6-12.

Only 10% of respondents said that they plan to spend more on IT in the first quarter; in an August survey, 13% said that they planned to spend more.

"It's not just that the numbers are so horrific right now, it's that this is the point seasonally that we expect to see spending improve. Instead, we're seeing a collapse," said Paul Carton, research director at the Rockville, Md.-based investment research firm.

"We're just looking for a break in the gloom," Carton added. "It doesn't even have to go up. Even if the rate of spending levels off, that would be a bullish indicator."

The study indicated that IT organizations have already been engaged in some heavy belt-tightening. Thirty-nine percent of the respondents said that they have spent less than originally planned so far during the fourth quarter; in the last survey, 30% said that they had spent less than originally planned so far during the current quarter.

Respondents are also feeling increasingly skeptical that a quick economic recovery will occur. Forty-eight percent expect their IT budgets to be lower in the first half of 2009 than they were during the same period this year -- that's more than double the percentage of respondents who answered that way in the previous survey.

Larger enterprises are pulling back on spending slightly more than smaller ones, according to the study. Forty-nine percent of respondents at companies with 1,000 or more employees said they would spend less money or nothing on IT in the first quarter, compared to 43% of those at organizations with one to 10 workers.

Reprinted with permission from Story copyright 2014 International Data Group. All rights reserved.
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