2H22 Macro Data Overview

ETR Data Captures Trends on Budgets, Priorities, Wage Growth, Remote Work and more

ETR Research 

| July 28, 2022

Enterprise Technology Research (ETR) released its latest Macro Views data, which found that overall IT spending is down, tech hiring is slowing, and organizations plan to reduce IT spend in 2022 primarily through the consolidation of redundant vendors across business units. Over 1,200 IT decision makers - representing more than $600 billion in annual IT spend - participated in ETR's Macro Views Survey (see below for full composition breakdown).

We begin with overall IT spend for the remainder of 2022, where the data shows:

IT Spending: Overall IT spend is now estimated to be up 6.6% in 2022 compared to the much loftier expectations of +8.3% growth that survey respondents cited at the beginning of the year.

o Midsize organizations show higher-than-average estimated spending growth, standing at +8.2% over last year.

o IT spending is strongest among the Energy/Utilities (+8.5%), and Retail/Consumer (+7.7%), and Government (+7.5%) sectors, while Nonprofits and Educational institutions both estimate just 4.4% growth.

Plans to Decrease IT Spending: “Consolidating redundant vendors across business units” was the most common response to what method organizations plan to use to decrease IT spend, followed by an “Other” category that included write-in responses about reducing staffing, reducing hardware and CapEx projects, and moving to the cloud.

IT Spending Priorities: Cybersecurity remains the top IT priority for organizations, followed by Collaboration/Productivity technologies and Cloud Migration.

Hiring and Wages in IT: As seen below, half of the respondents indicated plans to increase hiring in the next three months in March 2022, but this number is now down to 46%.

o Likewise, plans to freeze hiring have grown from 6% to 11% in the same time period.

o Since March 2022, plans to layoff employees have grown from 3% to 5%.

o Not shown in this data visualization, but also captured within this survey, 73% of organizations anticipate the median wage of their IT department will grow over the next six months for both existing employees and new hires. New hires, however, will see the biggest bumps in pay: 26% of respondents said new hires will get 6-10% jumps in pay and 20% anticipate pay increases of more than 10% for new hires.

Anticipated Cost Increases: Most respondents (53-55%) anticipate hardware, insurance premium, and utility costs will increase in the next six months, while 49% anticipate increases in managed IT services costs.

o The majority (51%) of respondents anticipate real estate costs will stay the same, with approximately equal numbers anticipating increases (25%) and decreases (23%) for real estate costs.

The above is only a small portion of the full report, which also covers topics like remote and hybrid work trends and more vendor-specific takeaways. An accompanying qualitative Macro Views report also includes commentary from one-on-one, in-depth interviews that our analyst team hosted with IT decision-makers from the ETR community.

Having covered overall IT spend trends, industry vertical breakdowns, the most oft-cited methods to reduce spending, and increasing input costs above, now let's take a closer look at one of the vendor-specific analysis slides and how possible spending at the vendor level correlates to the broader spending patterns we have captured in the macro survey at large: 

The chart above is a new release for ETR, and is designed to illustrate a scenario where IF an ITDM was planning to cut spending…where would those spending cuts flow to…AND which vendors might be impacted most in that scenario. More simply put, the purpose of this analysis is to see what vendors are impacted most IF budgets were forced downward. The chart depicts two Net Scores (ETR's proprietary measure for forward-looking spend intent) for the vendors listed – 1) a Net Score rating from respondents with Flat or Positive Spending (in blue) and 2) a Net Score for respondents with negative spending (in red).

The analysis depicts several Microsoft product lines jumping out as having significantly lower Net Score among the negative respondent group…which as another ETR analyst wrote in its vendor report published this morning… Microsoft’s weaker Net Scores across key sectors serve as a cautionary tale for a world where IT budgets are seeing more widespread decrease. Remember, the data above (and several ETR Insights interviews) corroborate that IF spending was needed to be curtailed quickly, consolidating existing licenses would be the first place ITDMs would act.

This analysis also calls out a few security leaders including Zscaler and Crowdstrike, which has one of the widest disparities between its two Net Score scenarios in this entire analysis…in security, we also see Qualys and Proofpoint….In Enterprise Apps, the SaaS giant Salesforce also earns a dishonorable mention in this analysis. In the full report, ETR re-runs this same analysis for vendors with lower total citation numbers, where we see the Apple-device-centric Jamf show up. We also see RPA player UiPath in this analysis. Also of interest, is the frequent appearance of IBM / RedHat product lines where we track the vendor; including Container Orchestration, Servers, Security, and Analytics.

ETR community members and subscribers can view the full report HERE. If you don't yet have access to ETR's industry-leading research but are curious to try it out for yourself, you can get started on your FREE TRIAL today.  

Enterprise Technology Research (ETR) is a technology market research firm that leverages proprietary data from our targeted IT decision maker (ITDM) community to bring you actionable insights about spending intentions and industry trends. Since 2010, we have worked diligently at achieving one goal: eliminating the need for opinions in enterprise research, which are often formed from incomplete, biased, and statistically insignificant data. Our community of ITDMs represents $1+ trillion in annual IT spend and is positioned to provide best-in-class customer/evaluator perspectives. ETR’s proprietary data and insights from this community empower institutional investors, technology companies, and ITDMs to navigate the complex enterprise technology landscape amid an expanding marketplace. Discover what ETR can do for you at www.etr.ai