Survey: CIOs plan to boost spending in next 12 months

Some 200 CIOs surveyed last month by CIO magazine in the US said they plan to increase their technology spending by 6.4 percent over the next 12 months, up from a 4.5 percent increase projected in July. If those spending plans pan out, it would mark the highest projected increase in IT spending since May 2002, according to the magazine's monthly poll.

The increase in spending reflected overall consumer confidence and the general mood about the economy -- the perception that things are getting better, according to Gary Beach, group publisher at CIO.

Most CIOs also said they have an application backlog. "When they were asked if they had an application backlog, about nine out of 10 CIOs said yes," said Beach. "And 48 percent said the backlog was significant."

The CIOs also said their IT budgets increased an average of 2.8 percent during the previous 12 months, an improvement from the 1.3 percent increase reported in the July poll, he said.

When asked about spending in eight specific IT categories, the average number of respondents planning to increase spending rose to 37.9 percent in August, up from 36.9 percent in July. The number of those planning on lower IT spending fell to 13.4 percent, down from 18.2 percent in July, according to the poll.

Security software continues to be the strongest sector, with roughly 51 percent of respondents planning to increase spending in that area, a decline from 52.2 percent in July. Only 2.5 percent plan to decrease spending on security software, compared to 5.9 percent that planned to cut spending in that area in July.

The outlook for computer hardware spending also improved month to month. Of the CIOs polled, 45.6 percent plan to spend more in the coming year, up from 44.3 percent who said they would do so in July, while 15.5 percent plan to cut spending, down from the 20.6 percent recorded in July.

The percentage of CIOs planning to increase spending on infrastructure software was 28.6 percent in August, down from 33.2 percent in July. The number of those planning to decrease infrastructure spending fell to 14.6 percent in August from 22.0 percent in July.

IT compensation costs, including salaries, benefits, and bonuses excluding stock options, rose by an average of 2.7 percent in the 12 months ending in August, down from 3.3 percent in July, but up from 2.3 percent a year ago. And 5.9 percent of respondents reported IT professionals were hard to find and retain, down from 6.3 percent last month and 8.3 percent a year ago.

The CIO magazine monthly Tech Poll gauges technology growth trends and assesses their impact on the overall economy. The CIOs, 96 percent of whom were in North America, answered questions on overall current and projected IT budgets. Also covered are future spending plans for IT hardware, software, services and Internet initiatives. The August poll was conducted from Aug. 7 to 14.

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