Gartner forecasts 6.2% growth in worldwide IT spending in 2021

While worldwide IT spending declined by 3.2% in 2020, as CIOs focused on mission-critical technology and services in the early stages of the Covid-19 pandemic,  all segments are predicted by Gartner to return to growth in 2021.

Enterprise software is expected to see the strongest rebound as remote working environments are developed, with an 8.8% increase being forecasted, while devices (8%) is projected to see the second highest growth.

The Gartner forecast trumps its previous prediction for IT spending, which projected 4% growth globally.

Lockdowns and social distancing measures have been presented as double-edged swords, as unprecedented speeds of transformation to facilitate remote working, education and new social norms took hold in 2020, while IT spending was negatively affected.

“CIOs have a balancing act to perform in 2021 — saving cash and expanding IT,” said John-David Lovelock, distinguished research vice-president at Gartner.

“With the economy returning to a level of certainty, companies are investing in IT in a manner consistent with their expectations for growth, not their current revenue levels. Digital business, led by projects with a short time-to-value, will get more money and board level attention going into 2021.

“There are a combination of factors pushing the devices market higher. As countries continue remote education through this year, there will be a demand for tablets and laptops for students.

“Likewise, organisations are industrialising remote work for employees as quarantine measures keep employees at home and budget stabilisation allows CIOs to reinvest in assets that were sweated in 2020.”

Going forward, organisations will be forced to further accelerate transformation plans by at least five years to cope with a post-Covid world involving permanently higher adoption of digital touchpoints and remote work.

Despite the growing availability of vaccines through 2021, Covid-19 will continue to require government health interventions throughout 2021, while geopolitical factors such as Brexit and tensions between the US and China will also inhibit recovery for some regions.

While some countries may see a return of IT spending to 2019 levels, this won’t be seen across the entire world until 2022, according to Gartner.

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Lovelock continued: “Digital business represents the dominant technology trend in late 2020 and early 2021 with areas such as cloud computing, core business applications, security and customer experience at the forefront.

“Optimisation initiatives, such as hyperautomation, will continue and the focus of these projects will remain on returning cash and eliminating work from processes, not just tasks.

“Covid-19 has shifted many industries’ ‘techquilibrium’. Greater levels of digitalisation of internal processes, supply chain, customer and partner interactions, and service delivery is coming in 2021, enabling IT to transition from supporting the business to being the business.

“The biggest change this year will be how IT is financed, not necessarily how much IT is financed.”