IT budgets slashed in 2009

 

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By Barry Collins

Posted on 8 Jun 2009 at 14:36

More than four out of ten IT managers had their budgets slashed in the first quarter of 2009, according to a new survey by analysts Gartner.

The survey found that 46% of firms have had their IT budget altered since it was finalised. Of those, more than 90% have seen their spending cut, at the expense of jobs in many cases.

"CIOs reported that renegotiating vendor contracts and head count reductions were the primary focus areas for accommodating budget reductions," says Mark McDonald, group vice president and head of research for Gartner.

"CIOs report shifting more work to in-house resources and delaying capital expenditures more than reducing IT project investments."

When Gartner conducted the same survey at the end of last year, IT budgets were relatively flat, with an average increase of only 0.16%. That figure has fallen off sharply, with IT budgets now showing a weighted average decline of 4.7%.

On the bright side, the IT managers interviewed by Gartner seem to think the worst is over. Most claim that further cuts in 2009 are unlikely, with the majority expecting budgets to start improving again between the first and third quarter next year.

IT projects and more staff are the two spending priorities for CIOs, if and when budgets do start to pick up.

A fortunate 4% of companies actually reported an increase in their IT budget at the start of 2009. Alas, Gartner doesn't reveal who the lucky companies are.