June 2009

Is the IT recession so bad?

IT budget cuts are not as bad as expected in the UK, and neither in SA, with UK IT bosses reigning IT budget in at around 10%. It could have been a lot worse.

This is according to Karen Geldenhuys, MD of Abacus Recruitment, the local IT recruitment agency, who said that budgets are still being “assessed and reassessed” and the same applies for SA.

In the UK, almost half of corporate technology leaders are recovering from the nasty shock of finding out there was nothing final about their boss’s promise of their finalised IT budget.

“It is a similar case here,” said Geldenhuys. “Things are in a state of flux”.

Reasons given by a leading IT contracting publication: that IT top brass are understanding the slowdown more, or cementing their response to it. So, rather then being disaterous, CIOs say their recently set IT budgets show cuts of up to 10%.

The downward revisions, which affect 46% of CIOs in all major sectors, came in the first quarter of this year, and signal the majority will cut their IT spending by 7%.

According to ContractorUK, Analysts at Gartner, who measured how IT budgets are measuring up in the final “fiscal Wobble”, compared the fall in budgets with predictions in December that they would hold up.

At the time, CIOs said their finalised IT budgets for the year would effectively freeze, with a minor increase of 0.16%, indicating IT spending would defy the downturn.

“We could see the same happen in SA,” said Geldenhuys.