Australian IT spending has been forecast to grow at little more than the inflation rate over the next two years.
Research group Gartner has forecast that there will be $79.9 billion of IT spending in Australia in 2016 – up 2.5 percent from the year before. In 2017, spending is expected to rise another 2.6 percent, to $81.9 billion.
The national inflation rate is currently running at 1.7 percent, according to the Australian Bureau of Statistics.
Software is expected to experience the biggest growth, with spending forecast to increase 9.6 percent to $10.2 billion in 2016 and then another 9.8 percent to $11.2 billion in 2017.
Communications services spending will climb 3.0 percent in 2016, to $27.2 billion, and 2.4 percent in 2017, to $27.8 billion.
The IT services sector is also likely to expand – by 1.9 percent to $29.0 billion in 2016 and by 2.1 percent to $29.7 billion in 2017.
Spending on data centre systems has been forecast to fall 1.5 percent to $2.76 billion in 2016, but then rise 1.7 percent to $2.81 billion in 2017.
However, spending on devices is expected to fall in both years – by 1.9 percent to $10.7 billion in 2016 and then by another 2.4 percent to $10.4 billion in 2017.
Meanwhile, Gartner has forecast that New Zealand’s total IT spending will grow 1.4 percent in 2016 and 2.0 percent in 2017.
Throughout the world, IT spending is forecast to fall from US$3.51 trillion ($4.67 trillion) in 2015 to US$3.49 trillion in 2016, a decline of 0.5 percent.
Gartner research vice-president John-David Lovelock said economic uncertainty has prompted companies to reduce their IT spending – even though they realise the need to invest in technology to support digital business.
“To make that happen, leaders are engaging in tough cost optimisation efforts in some areas to fund digital business in others,” he said.
"As an example, the savings from legacy system optimisation and enhancements are being redirected to fund digital initiatives. It's about doing more with the same funds.”
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