Computer Orders Decline - InformationWeek

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Computer Orders Decline

New government report showing an 11.9% drop in orders for IT wares corresponds with a falloff in the confidence business-technologists have in the economy, as tracked by InformationWeek.

Orders for computer products weakened in May, though year-over-year performance remains strong, the Commerce Department reported Tuesday.

The value of new orders for computers fell 11.9% in May, compared with April, to nearly $6.7 billion, though the level of orders stood 28.8% higher than they were a year earlier. As a comparison, orders for all manufactured goods rose 2.9% in May, bolstered by demand for nondefense aircraft and parts. Overall factory orders would have slipped by 0.1% without those transportation orders. Computer orders represent a mere 1.7% of all orders for manufactured goods, which the government pegged at $394.1 billion.

Also declining in May compared with April, the value of computer shipments by 5.5%; unfilled orders by 4.8%, and inventories by 0.4%. All figures are seasonally adjusted; those for May are preliminary.

The factory-orders report jibes with the just-released InformationWeek IT Confidence Index, which shows an 8.9% decline in confidence in the economy by IT decision makers. Some survey takers suggest IT spending might be curtailed if the economy doesn't improve. The latest factory-orders report suggests that a pullback in IT spending might have started.

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