CDW: IT Spending, Hiring Outlook a Mixed Bag

Calling the IT outlook a "mixed bag," CDW said that the mood of those in charge of the IT purse strings brightened a bit in the first two months of this year compared with the last two months of 2007, but IT decision makers are still holding on tight to the moneybags.
 
That’s the conclusion from the second edition of the CDW Index, a measurement of IT decision-maker sentiment with regard to spending and hiring, based on a bi-monthly survey of 1,000 companies. CDW released its inaugural edition of the index in early January.

For more on the CDW Index, click here.

"Now you have IT decision makers who are expressing that they think their IT projects will get funded this year," said Mark Gambill, the CDW vice president in charge of the index. However, on the other side "CEOs are saying, ‘let’s not go crazy here – let’s delay some spending.’"

That means small purchases and projects are likely to continue to be funded as usual, but mid-sized projects are likely in a holding pattern, Gambill said.

"If you had an enterprise-wide refresh pending, maybe you would hold off," Gambill said.

Among the key findings of the most recent survey:

• Twenty-six percent of those surveyed plan to hire more IT staff in the next six months compared to 16 percent in December 2007.
• Fifty-four percent plan to increase IT budgets in the next six months compared to 38 percent in December 2007. Six percent plan to decrease their budgets in February compared to 11 percent in December 2007.
• The number of medium and large businesses expecting increased IT budgets in the following six months increased by 20 percentage points.

But while larger businesses expressed more optimism, smaller businesses took the glass-half-empty view.

"Small business people are clearly more concerned," Gambill said. "They tend not to value what IT can do for them in terms of growing their businesses the way medium and large businesses do."

Reflecting that, CDW reported that only 39 percent of small businesses said that IT is helping their bottom line compared to almost 80 percent of medium and large businesses.

Gambill said that some IT categories are likely to fare better than others. Those that look good for 2008 include mobility, unified communications, virtualization and storage.

"These are critical areas for all companies," he said.