Research by investment bank Goldman Sachs has predicted
that corporate IT spending will not stage a full-blown recovery
this year as previously hoped.
The report on US companies forecast that the financial services
market, which is the largest for IT spending, will increase
spending by 4%, compared with a 25% decline last year.
In
manufacturing, IT spending is projected to increase overall by 5%,
compared with last year's drop of 16%. And in the IT market itself,
IT spending is projected to be down by 5%, compared with a hefty
33% decline in 2002.
In the
communications market, IT spending is expected to "retreat from
steep declines in 2002, but [Goldman Sachs] still expects spending
to be down 12%", the report said.
"This
message remains consistent with our view that companies continue to
tighten what are, in many cases, already anaemic capital budgets,"
the report continued. While adjustments could take place within
companies, "the magnitude of cutbacks already in place seems to
support what could be another disappointing year for IT
spending".
The report
covered corporate capital expenditures in 2001 and 2002 and the
projected expenditures for 2003 of 752 companies spanning 53
business sectors.
Goldman
Sachs predicted there would be an overall decline of 10% in capital
expenditure this year, on top of a 15% decline last year.