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10/13/2006
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IT Managers Are Decidedly Unenthusiastic About Economy

InformationWeek IT Confidence Index barely budges; little change in outlook from a year ago

Business technologists are tentative about prospects for the economy in the coming months, according to the latest InformationWeek IT Confidence Index. The metric, which assesses attitudes of 300 business technology managers, barely budged in the third quarter, up only 0.8% from the quarter before and lingering at about the same level as a year ago.

IT Confidence Index graphInfluencing survey respondents is an economy that shows little promise of significant growth anytime soon. Though unemployment remains stable, job growth is anemic. The latest quarterly increase in gross domestic product rose at a pace below the 2005 rate. And the past quarter's growth in business productivity is down from earlier this year. Combine that with the uncertainties raised by elections three weeks away and troubles in the Mideast and North Korea, and you can see why IT managers have little enthusiasm for near-term prospects.

Nearly half of the respondents say their companies' total IT spending for the coming quarter will be flat, one-third foresee an increase, and nearly one in five predict a decrease. But flat IT spending isn't necessarily bad--it could mean smart spending.

The poll suggests many companies are getting more bang for their IT buck. Two-thirds of respondents say they're positive about their companies' IT budgets and spending plans. That's up from 46% a year ago, the only response for the dozen questions asked in which this past quarter's reply significantly differed.

IT shops should be as busy in the fourth quarter; 53% of respondents are positive about IT project starts and initiatives over the next three months, the same percentage as last year.

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