IT Spending to Increase in 2012

InformationWeek’s annual Outlook 2012 Survey displayed a very bullish outlook on 2012. The report, which queries 605 business technology professionals on their plans for IT spending and hiring in 2012, found that 25 percent of companies are planning to expand IT staff and only nine percent will be cutting back. That's in stark comparison to two years ago when only 14 percent said they were expanding and 18 percent said they were cutting back.

Fifty-six percent of participants say they will be spending more on IT than in 2011, 28 percent said their spending plans are flat, and only 16 percent expect to shrink their IT budgets. Most encouraging is that 18 percent plan to raise their IT spend by more than ten percent, which is up from last year's response of 15 percent.

However, InformationWeek presents several reasons why growing project demand will not necessarily lead to more hiring. Despite only three percent reporting that the demand for new IT projects is dipping, almost one-third (30 percent) report there is a hiring freeze and "won't be allowed to fill openings" in 2012. "CIOs continue to rely heavily on outsourcing as the variable component to their workforces, absorbing the peaks of IT demand as well as fulfilling specialized skills." The editors go on to report that,  there’s strong demand for mobile app development, but much of that work is outsourced and cloud computing allows companies to add IT capabilities without the same staff."

In comparison, CIO Insight also released a study with some interesting observations. CIO Insight's 2012 IT Investment Patterns Study used a random sample from parent company Ziff-Davis Enterprises. The 329 respondents in organizations with 50 or more employees were familiar with their company's budget and spending levels. They report three broad trends for 2012:

• Areas that organizations may have given short shrift to in the past due to the economy are now being funded in 2012. Increased investments in security are an example of what the editors call "Reversion."
• Increased popularity for organizations in mobility and cloud-related spending, or what CIO Insight is referring to as “Innovation”. Most (91 percent) of organizations plan to spend 14.6 percent more on mobile devices, which is  the third largest spending category, surpassed only by servers and desktops / notebooks.
•  Spending continues in existing areas such as infrastructure and software. CIO Insight calls this trend "Integration" to ensure established areas don't "get lost to the newcomers" (e.g. mobile and cloud).