Gartner Predicts a 6.8% Global Increase in IT Expenditure for 2024

According to Gartner, Inc.’s latest forecast, worldwide IT spending is anticipated to reach $5 trillion in 2024, reflecting a 6.8% surge from 2023. This projection, while slightly lower than the 8% growth forecasted in the previous quarter, dismisses the notion that generative AI (GenAI) would significantly impact short-term IT spending, similar to trends observed with IoT and blockchain in 2023.

John-David Lovelock, Distinguished VP Analyst at Gartner, noted that while GenAI holds transformative potential, its effect on IT spending will resemble that of other major trends. Lovelock anticipates that 2024 will witness organizations investing in planning for GenAI adoption, but more traditional factors such as profitability, labor, and persistent change fatigue will primarily drive IT spending.

In a significant shift, IT services are projected to become the largest segment of IT spending in 2024, with an expected growth of 8.7%, reaching $1.5 trillion. This growth is attributed to enterprises focusing on organizational efficiency and optimization projects during a period of economic uncertainty.

The table below outlines the forecast for worldwide IT spending in various segments:

	2023 Spending	2023 Growth (%)	2024 Spending	2024 Growth (%)
Data Center Systems	243,063	7.1	261,332	7.5
Devices	699,791	-8.7	732,287	4.6
Software	913,334	12.4	1,029,421	12.7
IT Services	1,381,832	5.8	1,501,365	8.7
Communications Services	1,440,827	1.5	1,473,314	2.3
Overall IT	4,678,847	3.3	4,997,718	6.8

In India, IT spending is forecasted to experience a double-digit growth of 11.1% in 2024, reaching $138.6 billion, up from $124.7 billion in 2023. The growth is attributed to increased spending on IT services (13.4% growth in 2024) as Indian businesses seek external expertise in areas such as AI, industry cloud, security, and data analytics. Additionally, a rebound in device spending is expected in 2024 as Indian consumers plan to increase their spending on mobile phones and other devices.

The table below outlines the forecast for IT spending in India:

	2023 Spending	2023 Growth (%)	2024 Spending	2024 Growth (%)
Data Center Systems	4,233	10.7	4,606	8.8
Devices	51,504	-2.6	57,852	12.3
Software	16,558	18.9	19,522	17.9
IT Services	25,486	10.1	28,898	13.4
Communications Services	26,952	3.1	27,754	3.0
Overall IT	124,733	4.0	138,631	11.1

In 2024, spending on IT services in India is expected to grow by 13.4%, up from 10.1% in 2023, driven by a lack of internal skills, leading businesses to partner with external providers. Additionally, device spending is set to rebound as Indian consumers plan to increase spending on mobile phones and other devices.

The overall growth rate for global IT spending in 2023 was 3.3%, a marginal increase of 0.3% from 2022, attributed to change fatigue among Chief Information Officers (CIOs). However, Gartner anticipates a resurgence in momentum in 2024, with an overall IT spending growth rate of 6.8%. Despite this positive outlook, the broader IT spending environment remains slightly constrained by change fatigue, with CIOs exhibiting resistance to new contracts, long-term initiatives, or new technology partnerships. Initiatives launched in 2024 will require higher levels of risk mitigation and greater certainty of outcomes.

Gartner’s IT spending forecast methodology relies on a comprehensive analysis of sales data from over a thousand vendors across the entire IT product and service spectrum. The quarterly IT spending forecast by Gartner provides valuable insights into market opportunities and challenges, helping clients navigate the evolving landscape.