IT spending to increase 6.9% in the next 12 months

IT spending projections decreased in Q2 2006 with CIOs predicting IT spending to increase by 6.9% over the next 12 months, down from 8.6% in Q1 2006. QTQ spending projections increased in computer hardware, telecom equipment, outsourced IT services, infrastructure software and security software. While overall spending predictions decreased, 54.9% of respondents cited “enabling business processes” as their top spending priority for 2007 budget planning followed by 25.0% reporting the priority was “improving IT performance.” Q2 2006 results indicate that 48.1% of panelists plan to increase spending on computer hardware (up from 48.0% in Q1 2006), while 14.4% intend to decrease spending (vs. 12.8% in Q1 2006). IT compensation costs (including salaries, benefits, and bonuses excluding stock options) increased an average of 4.8% in the 12 months ending June, down from 6.6% in the 12 months ending March. The supply of labor remained essentially unchanged with 6.0% of the respondents reporting IT labor was “plentiful” (vs. 5.0% in Q1 2006), 64.3% cited IT labor was “available” (vs. 66.5% in Q1 2006) and 25.8% report that IT professionals were “hard to find” (vs. 26.3% in Q1 2006).