In 2023, spending on enterprise software and IT services is expected to reach at least $4.5 trillion, increasing by 2.4% over the 2022 total, yet underperforming previous expectations, according to new research by Gartner. Previous estimates predicted an increase of more than 5% to reach $4.6 trillion, but inflation, slow rebounds in hardware spending, and other economic concerns may have cooled expectations.
Hardware spending, on the other hand, is expected to decline by as much as 5.1% in 2023.
Although customers have had to face inflation in their daily lives, many enterprises are locked into their spending numbers due in part to contracts and recurrent expenses for managed services, cloud, SaaS, PaaS, and telecommunications markets. Also, although Gartner does not explore security spending, experts expect significant growth as enterprises work on new solutions to protect their systems and assets.
While tech companies of all sizes and markets have been on a layoff spree, many of the eliminations were in nontechnical positions, and outsourcing IT services has become preferred over maintaining internal departments in many cases. At the same time, skilled tech workers are avoiding enterprises in favor of service providers who can meet their desires for higher wages, improved growth opportunities, and better upward mobility for their careers.