Gartner Forecasts Worldwide IT Spending to Grow 6.8% in 2024

• Spending on IT Services to Surpass Communications Services Spending for the First Time in 2024

Worldwide IT spending is anticipated to whole $5 trillion in 2024, a rise of 6.8% from 2023, in response to the newest forecast by Gartner, Inc. This is down from the earlier quarter’s forecast of 8% development. While generative AI (GenAI) had important hype in 2023, it is not going to considerably change the expansion of IT spending within the near-term.

“While GenAI will change everything, it won’t impact IT spending significantly, similar to IoT, blockchain and other big trends we have experienced,” stated John-David Lovelock, Distinguished VP Analyst at Gartner. “2024 will be the year when organizations actually invest in planning for how to use GenAI, however IT spending will be driven by more traditional forces, such as profitability, labor, and dragged down by a continued wave of change fatigue.”

IT Services Becomes Largest Segment of IT Spending in 2024

IT companies will proceed to see a rise in development in 2024, turning into the most important section of IT spending for the primary time. Spending on IT companies is anticipated to develop 8.7% in 2024, reaching $1.5 trillion (see Table 1). This is essentially because of enterprises investing in organizational effectivity and optimization initiatives. These investments will probably be essential throughout this era of financial uncertainty.

“Adoption rates among consumers for devices and communications services plateaued over a decade ago. Consumer spending levels are primarily driven by price changes and replacement cycles, leaving room for only incremental growths, so being surpassed by software and services was inevitable,” stated Lovelock. “Enterprises continue to find more uses for technology – IT has moved out of the back office, through the front office and is now revenue producing, until there is a plateau for how and where technology can be used in an enterprise, there cannot be a plateau in enterprise IT spending.”

Table 1. Worldwide IT Spending Forecast (Millions of U.S. Dollars) 

Source: Gartner (January 2024)

CIOs’ Change Fatigue Continues to Impact IT Spending

The general IT spending development charge for 2023 was 3.3%, solely a 0.3% improve from 2022. This was largely because of change fatigue amongst CIOs. Momentum will regain in 2024, with general IT spending rising 6.8%.

Even with the anticipated regained momentum in 2024, the broader IT spending atmosphere stays barely constrained by change fatigue. Change fatigue might manifest as change resistance — with CIOs hesitating to signal new contracts, decide to long-term initiatives or tackle new expertise companions. For the new initiatives that do get launched, CIOs require increased ranges of threat mitigation and higher certainty of outcomes.

Gartner’s IT spending forecast methodology depends closely on rigorous evaluation of the gross sales by over a thousand distributors throughout the complete vary of IT services. Gartner makes use of major analysis methods, complemented by secondary analysis sources, to construct a complete database of market dimension knowledge on which to base its forecast.

The Gartner quarterly IT spending forecast delivers a singular perspective on IT spending throughout the {hardware}, software program, IT companies and telecommunications segments. These reviews assist Gartner shoppers perceive market alternatives and challenges. The most up-to-date IT spending forecast analysis is offered to Gartner shoppers in “Gartner Market Databook, 4Q23 Update.”