Australian Enterprise IT Spending to Grow 3.6% in 2021

In BICSI Blog, BICSI Bytes, Featured, News by info@bicsi.com.au

According to the latest Gartner forecast, enterprise IT spending across all industry sectors in Australia will grow 3.6% to reach more than AU$95.8 billion in 2021, following an expected 2.8% decline in 2020.

While all sectors are feeling the economic impact driven by COVID-19, utilities, government, education and healthcare have proven to be the most resilient in technology spending in Australia in 2020. Transportation, manufacturing and natural resources have been the hardest hit.

Kristian Steenstrup, research vice president at Gartner, explained that COVID-19 response is different in the resources and manufacturing industry from other industries because it’s not always physically possible to shut down a site, adding: “These companies are in the top-three sectors for technology spending in Australia, but as they are designed for continuous operation, they simply can’t respond to external factors as quickly as a retailer, for example.

“The physical nature of asset-intensive industries makes it harder for employees to work from home. Looking ahead, we’re seeing strong interest from CIO clients in technologies such as proximity tracking to enable fast response to outbreaks and in the longer-term remote monitoring and control of equipment. Analytics, artificial intelligence (AI) and the Internet of Things (IoT) will also attract investment next year.”

Transportation has been negatively impacted by COVID-19 with some airlines grounding 95% of their fleet given lockdowns and country government restrictions for international travel. Work-from-home policies have hit commuter revenues on public transportation. Contagion concerns still abound as transit authorities implement passenger safety initiatives. Given the financial impact, this sector had to cut back on IT spending by 15.5% in 2020.

Technology spending by education organisations in Australia is forecast to grow 8.6% to more than $3.1 billion in 2021 due to increased and necessary investments in laptops, tablets, communication and collaboration technologies to support online learning. Most primary, secondary and tertiary education institutions are offering either full online learning support or blended learning (combination of on-campus and online instructions).

In addition to learner investment needs, education institutions are also investing in COVID-19 testing and contact tracing. Many research institutions as well as public health schools are contributing to COVID-19 related research and development worldwide.

IT spending by healthcare providers in Australia is forecast to grow 8.2% in 2021. The healthcare provider industry will continue to optimise its spending on legacy technology, prepare the organisation for digital transformation and accelerate investment in key technologies that enable data-driven decision making. COVID-19 has catalysed the adoption of IoT technologies (like virtual care and remote patient-monitoring) and further spurred the already growing interest in BI/analytics and AI projects.