Gartner Forecasts Worldwide IT Spending to Reach $4.4 Trillion in 2022.
Rates of Inflation, Geopolitical Disruption and Talent Shortages Not Expected to Slow IT Investments.
According to Gartner, Inc.’s latest prediction, global IT investment would reach $4.4 trillion in 2022, up 4% from 2021.
“This year is proving to be one of the noisiest years on record for CIOs,” said John-David Lovelock, distinguished research vice president at Gartner. “Geopolitical disruption, inflation, currency fluctuations and supply chain challenges are among the many factors vying for their time and attention, yet contrary to what we saw at the start of 2020, CIOs are accelerating IT investments as they recognize the importance of flexibility and agility in responding to disruption.
“As a result, purchasing and investing preference will be focused in areas including analytics, cloud computing, seamless customer experiences, and security.”
Inflation impacts on IT hardware (e.g., mobile devices and PCs) from the past two years are finally dissipating and are starting to spill over into software and services. With the current dearth of IT talent prompting more competitive salaries, technology service providers are increasing their prices, which is helping to increase spending growth in these segments through 2022 and 2023. Software spending is expected to grow 9.8% to $674.9 billion in 2022 and IT services are forecast to grow 6.8% to reach $1.3 trillion (see Table).
Worldwide IT Spending Forecast (Millions of U.S. Dollars)
|2021 Growth (%)||2022 Spending||2022 Growth (%)||2023 Spending||2023 Growth (%)|
|Data Center Systems||207,306||6.7||218,634||5.5||230,385||5.4|
The rise of enterprise application software, infrastructure software, and managed services in the short and long term illustrates that the digital transformation trend is systemic and long-term, not a one- or two-year trend. Infrastructure as a service (IaaS), for example, supports every major consumer-focused online offering and mobile application, accounting for over 10% of total software investment growth in 2022.
According to Gartner, digital business objectives such as end-to-end customer experience and supply chain efficiency will drive spending on corporate applications and infrastructure software into double digits in 2023.
The invasion of Ukraine by Russia is unlikely to have a direct effect on worldwide IT spending. Price and pay inflation, combined with talent shortages and other delivery risks, are projected to have a significant impact on CIOs’ plans in 2022, but technology investments are not expected to halt.
“CIOs anticipate having the financial and organizational ability to invest in key technologies throughout this year and next,” said Lovelock. “Some IT spending was on hold in early 2022 due to the Omicron variant and subsequent waves but is expected to clear in the near-term.
“CIOs who keep their eye focused on key market signals, such as the shift from analog to digital business and buying IT to building it, as well as negotiate with their vendor partners to assume ongoing risks, will fare better in the long-term. At this point, only the most fragile companies will be forced to pivot to a cost cutting approach in 2022 and beyond.”
Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of the sales by over a thousand vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.