Medium-sized and Large Business Looking to Invest in IT Again

While large business and medium-sized business are showing more confidence with plans to invest in IT products and IT staff again, small business IT investment may have slipped.

That’s according to the most recent survey of IT professionals and the CDW IT Monitor. In the government sector, federal government IT decision makers are showing even more confidence, according to the survey.

However, because the pattern of the current recession is different from past recessions, it’s hard to predict whether the return of confidence among large and small business and among government IT decision makers can be sustained.

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"This downturn has not followed the path of previous ones, making it more difficult to predict the shape of the recovery," says Mark Gambill, the CDW vice president in charge of the survey, in a prepared statement. "But IT confidence has held steady for nearly four months, and we're now beginning to see signs of a patchy turnaround with medium and large businesses anticipating future growth."

The most recent survey shows that sentiment remains stable across the broader IT marketplace, with the overall CDW IT Monitor score remaining flat for the third consecutive reading. CDW conducts the survey every two months.

CDW notes that the signs of anticipated growth in investment that first appeared in the April survey are now becoming more visible, such as the following:

• 83 percent of medium sized businesses expect to purchase new software in the next six months (up 5 percent since April).
• 28 percent of large businesses expect to hire additional staff in the next six months (also up 5 percent since April).
• 52 percent of federal IT decision makers anticipate budget increases in the next six months (an increase of 17 percent since April and, CDW notes, the largest leap in the government sector to date.)

However, while small businesses showed signs of increasing confidence earlier this year, fewer currently expect their budgets to improve, according to the most recent survey. Now only 21 percent of small business IT decision makers say they expect their IT budgets to increase in the next six months, down 8 percent since April. And only 17 percent of local government IT decision makers expect their IT budgets to increase in the next six months, down 6 percent since April.
 
"The unsteady nature of this turnaround is demonstrated by the slight decline in small business confidence,” says Gambill. “Larger companies have been aggressively managing costs as well through this period, but there comes a point when investments have to be made."

The CDW IT Monitor is based on an online survey of at least 1,000 IT decision makers from businesses of all sizes and all sectors of government.