Despite economic headwinds experienced across the sector, IT spending in New Zealand is forecast to grow 6 per cent in 2023 to reach $17.6 billion, according to Gartner.
Gartner also forecasts a 10.4 per cent growth in IT services as organisations increase spending on digital projects.
However, after strong growth during the pandemic, spending on devices is set to decline slightly in 2023.
Globally, IT spending is forecast to grow 5.1 per cent to reach US$4.6 trillion as organisations continue to push forward with digital initiatives, according to Gartner.
“Enterprise IT spending is recession-proof as CEOs and CFOs, rather than cutting IT budgets, are increasing spending on digital business initiatives,” Gartner research vice president John-David Lovelock said.
“Economic turbulence will change the context for technology investments, increasing spending in some areas and accelerating declines in others, but it is not projected to materially impact the overall level of enterprise technology spending.
“However, inflation has cut into consumer purchasing power in almost every country around the world. Consumer purchasing power has been reduced to the point that many consumers are now deferring 2022 device purchases until 2023, driving spending on devices down 8.4 per cent in 2022 and 0.6 per cent in 2023.”
In a downward economy, a traditional solution would be to cut costs, including IT costs. However, a July 2022 Gartner survey of more than 200 CFOs found that 69 per cent plan to increase their spend on digital technologies.
Companies will use digital technologies to “reshape” their revenue streams, Lovelock said.
“This trend has fed the shift from buying technology to building, composing and assembling technology to meet specific business drivers. This shift is foundational to the growth of cloud over on-premises for new IT spending,” he continued.