IT spend in India to grow by only 7.7%, attraction and retention of talent to be difficult: Report

In India, cloud services is the underpinning driver for 10.3% IT services growth in 2022. Software is forecast to grow by 16.1% in 2022, compared to 19.9% in the previous year.

Published: 16th July 2022 03:47 PM  |   Last Updated: 16th July 2022 04:21 PM   |  A+A-

IT sector, techie, computers, office

Image used for representational purpose only.

By Express News Service

BENGALURU: Global economic uncertainty continues to be an area of concern for Indian enterprises, as IT spending in India is projected to grow by 7.7% to reach $114.9 billion compared to the previous year growth rate of 21.2%, according to Gartner.

The global IT spending is expected to increase by 3% to reach $4.5 trillion in 2022.

"Ongoing investment on hyperscale data centres coupled with average selling price (ASP) increase is forecast to drive 13.6% revenue growth for data centres in 2022. Digitisation and application modernisation will trigger software refresh including ongoing SaaS adoption,” said Naveen Mishra, senior director analyst at Gartner.

In India, cloud services is the underpinning driver for 10.3% IT services growth in 2022. Software is forecast to grow by 16.1% in 2022, compared to 19.9% in the previous year.

"Consumer spending is tightening with high inflation coupled with supply constraints which leads to modest 6.6% growth for devices in 2022," Mishra added.

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While worldwide IT spending is expected to grow in 2022, it will be at a much slower pace than 2021 due to spending cutbacks on PCs, tablets and printers by consumers, causing spending on devices to shrink 5%.

Price increases and delivery uncertainty, exacerbated by the Russian invasion of Ukraine, have accelerated the transition in purchasing preference among CIOs, pushing global cloud spending to 18.4% growth in 2021 and expected growth of 22.1% in 2022, Gartner said.

Globally, data centre systems spending is projected to see the strongest growth of all segments in 2022 at 11.1%. Cloud consulting and implementation and cloud managed services are expected to grow by 17.2% this year, from $217 billion in 2021 to $255 billion in 2022.

The IT labour market continues to tighten, making it difficult to attract and retain talent. Technology service providers are increasing prices on IT to allow for competitive salaries. This is driving an increase in spending in software and services through 2022 and 2023.

The critical IT skills shortage being felt across the globe is expected to abate by the end of 2023 when the corporate drive to complete digital transformations slows down and there has been time for upskilling and reskilling of existing staff.
However, in the near term, CIOs will be forced to take action to balance increased IT demand and dwindling IT staffing levels, Gartner added.


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