Business & Economics
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The CompTIA IT Industry Business Confidence Index recorded an impressive gain of 4.6 points during Q2, reaching its highest level in more than a year. Improving economic fundamentals and solid customer demand for technology products and services has brightened the outlook among IT industry executives.
Looking ahead, IT industry executives expect momentum to continue, leading to incremental gains in the index and the potential to push sentiment further into positive territory.
The industry has seen this pattern before though – a rebound that doesn’t quite take hold and slips back into a period of volatility and economic paralysis. Although many threats to growth have subsided, a number of factors could still potentially derail or minimize growth. IT industry executives are especially concerned about downward pressure on margins, weak customer demand, unexpected economic shocks (e.g. spike in oil prices, natural disaster, etc.) and government regulation.
The gap has narrowed, but there continues to be slight lag in sentiment among the smallest of IT companies. This often reflects the more precarious position of small businesses that have fewer reserves and smaller, less diversified customer bases than larger firms.
In the dynamic information technology industry, a consistent strategy of investing in new product or business lines is the only way to stave off obsolescence. As such, 43% of IT firms in this study plan to increase their level of investment in new products and business lines over the next six months. Additionally, 42% plan to increase investments in their technology, such as building out a cloud data center or upgrading a professional service automation (PSA) application.
The CompTIA IT Business Confidence Index was developed from a survey of 433 IT companies. The data was collected during April 2012.
CompTIA members can read the full report here.