There's more good economic news for IT vendors from the government. The U.S. Commerce Department on Friday reported that business spending on IT increased during the first quarter by 1.1% compared with the previous quarter, to a seasonally adjusted $573.6 billion in constant dollars. Though down 7.6% from a year earlier and $3.5 billion lower than an estimate issued last month, the first-quarter increase marked the first uptick in IT spending in a year.
IT spending represents 6.1% of the gross domestic product, which the government said rose 1.4% during the first quarter to nearly $9.48 trillion. The department last week reported that shipments of computer products rose 2.5% in April, reversing months of decline and suggesting that a tech recovery is under way.
While recent economic indicators are inspiring to those hoping for a turnaround soon, some economists remain guarded. Says William Baumol, an economics professor at New York University, "These are signs of improvement, but, frankly, you need a fortune teller with a crystal ball to see how much comfort you can take from them."