The UK’s IT industry shrank by 1% in 2008, according to a report from market analyst TechMarketView. It is the first time the sector has shrunk since 2003.
The MarketViews report predicts that the combined revenues of the UK’s software and IT services companies will shrink by 3% in 2009, and that the sector will continue to shrink until 2011.
That estimate is based upon current economic trends. Should conditions worsen, the report’s authors warned, the decline could last longer.
The sector has shrunk as a result of businesses cutting discretionary IT spending, the report found. “It’s ‘make do and mend’ all over again,” said report author Richard Holway.
The UK’s IT outsourcing industry is expected to grow between now and 2011, the report added, but it will not be sufficient to compensate for revenue falls elsewhere.