Information Technology Downtrends

Amidst the current economic downtrend and global financial crisis some of the major analysts forecast that the growth in United States IT and ITES spending will considerably reduce through 2009. The current global downtrend has forcibly held back some of the U.S. IT companies to cut down their research and related annual spending. These analysts opine that the U.S. IT down trend is hampering the IT spending growth at a very minimum expected rate of 1.5-2.0 percent. Some of the analysts predict that the purchases of software by the U.S. government and non government sector would grow in a minimal trend. The analysts are not even expecting a CAGR of 2.5 percent through 2010 for the hardware purchases. The major downtrend identified in IT and ITES segments is specific to IT consulting, which is expected to decline by 2-3 percent compared to that of 2008. These kind of negative signs are highly pressurizing the IT and ITES majors to re-think and revamp the hiring and cost cutting strategies.

Other related sectors such as financial services are not expected to grow as they are concentrating on cost cutting rather than increasing their annual expenditure. Media and entertainment is another sector that will highly reduce the IT spending, which will dip the huge revenues of IT and ITES companies. Retail and consumer durable segment has also begun facing the demand slow down due to increased inflation rates across the countries and decreased purchasing power among the people due to huge economic slow down. This will in turn reduce th IT or ITES spending of retail and consumer durables industry.