Experts Predict Billions Less in IT Spending

October 21, 2012

Deficit reduction measures — whether automatic sequestration cuts or a bipartisan cost-cutting agreement — will leave agencies with billions of dollars less to spend on information technology over the next five years, according to an annual industry forecast.

TechAmerica Foundation, which a year ago projected annual IT spending as high as $85.7 billion in fiscal 2017, last week downgraded its forecast by about $10 billion a year to $73.5 billion in spending this fiscal year and $77.2 billion in 2018. The marginal annual increase in IT spending amounts to a compound annual growth rate of less than 1 percent, or a 5 percent increase, according to the new forecast.

As overall discretionary spending is squeezed, IT spending is not immune to those cuts, said Robert Haas, a spokesman for the foundation.

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