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Jul 18, 2012

CompTIA IT Industry Business Confidence Index Takes Step Back in Q3

Downers Grove, Ill., July 18, 2012 – Renewed uncertainty about global economic conditions outweighed more positive sentiments about prospects for the information technology (IT) industry in the latest CompTIA IT Industry Business Confidence Index, the quarterly survey from the leading non-profit association for the IT industry.

The index slipped 2.2 percentage points in Q3, falling to 54.5 on a 100-point scale. By comparison, the Q2 reading of 56.7 was the highest index level in more than a year.

The index’s six-month outlook projects a modest increase of 3.1 points.

“The unfortunate pattern of the last several years is repeating itself in 2012,” said Tim Herbert, vice president, research CompTIA. “Momentum from improving economic fundamentals and positive sentiment fails to sustain itself, stalling at mid-year.”

The CompTIA IT Industry Business Confidence Index is an aggregation of opinions on the U.S. economy, the IT industry and one’s company. All three components of the index fell in Q3, with sentiment about the economy and one’s company falling slightly more than sentiment about the IT industry.

“Any bullishness about the IT industry generally and companies individually was offset by renewed uncertainty about larger economic issues, such as unemployment, stalled earnings at some bellwether companies and softening demand in many overseas markets,” Herbert said.

Additionally, the data indicates a slight increase in concern among IT industry executives regarding their ability to maintain profit margins. Inevitably, economic malaise leads to greater price sensitivity and decision-making paralysis among many customer segments, according to Herbert.
 
Net negative sentiment increased in Q3 for all three components of the index: the U.S. economy (net negative 72 percent, up 4 points), the IT industry (39 percent, up 5 points) and one’s company (39 percent, up 7 points).

IT Firms Plan Investments, but at a Slower Pace
IT firms surveyed by CompTIA still expect to increase investments in many areas, though it’s likely that in the short-term the rate of growth will slow somewhat. For example, in the Q2 survey, 37 percent of companies indicated they planned to increase expenditures on marketing and advertising. This number fell to 29 percent in Q3. A similar situation exists for spending increases associated with capital investments, new technology purchases, business travel and staffing.

On the hiring front, medium size firms (100 – 499 employees) are most likely to add new staff in the next six months. Overall, 32 percent of firms plan to increase staffing and 54 percent plan to remain at current levels.

“As customers seek out new technology options in cloud computing, big data, business process automation, mobility and other areas, IT firms must be vigilant in maintaining high levels of expertise through internal training, new hires or both,” Herbert noted.

The CompTIA IT Industry Business Confidence Index for Q3 2012 is based on a July 2012 online survey of IT industry executives and professionals. A total of 445 IT companies participated in the survey. The complete report is available at no cost to CompTIA members who can access the report at www.CompTIA.org or by contacting research@comptia.org.

About CompTIA
CompTIA is the voice of the world’s information technology (IT) industry. Its members are the companies at the forefront of innovation; and the professionals responsible for maximizing the benefits organizations receive from their investments in technology. CompTIA is dedicated to advancing industry growth through its educational programs, market research, networking events, professional certifications, and public policy advocacy. For more information, visit www.comptia.org or follow CompTIA at www.facebook.com/CompTIA and twitter.com/comptia.

Contact:
Steven Ostrowski
Director, Corporate Communications
CompTIA
630-678-8468
sostrowski@comptia.org