US Economic Woes to Slow Tech Spending

Researchers say the sector will continue to grow, but belts will be tightening
By Jim O'Neill,  Newser User
Posted Dec 11, 2007 11:38 AM CST
Students use computers in the Virginia Tech Math Emporium in Blacksburg, Va., Thursday, April 5, 2007. (AP Photo/Steve Helber)   (Associated Press)
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(Newser) – Tech-spending growth, on a roll since recovering from the 2000 dot-com bust beginning in 2004, is likely to slow next year, dragged down by US economic woes and rising oil prices, reports the Wall Street Journal. Research firms say companies are likely to keep spending, but more slowly. As one CIO said, “It’s not doom and gloom.”

Spending on technology grew nearly 6% annually from 2004 through 2006, and is expected to increase 6.9% this year. Research firm IDC projects 2008 growth of 5.5% to 6%, down from an anticipated 6.6%. Analysts say growth in India and China will accelerate, but project US growth slowing to 5.2%, down from an expected 5.7%, and below 2007’s 6.4%.