US tech spending growth to drop in 2009

IT sales in the US will take a hit from the economic turmoil currently rumbling through Wall Street in 2009, according to research firm Forrester.

The company revised its predictions yesterday on the same day that computer maker Dell admitted it had been hit hard by "soft" sales.

Forrester now says that year-over-year growth in sales of computers, software and outsourcing services will slow drastically next year, while tech spending growth is still expected to spike in 2008.

Echoing Dell’s comments yesterday about a “softening in global end-user demand”, the research house said businesses will tighten their belts towards the end of this year and the start of 2009. The result: Tech spending will soften with Forrester forecasting an increase next year of 6.1 per cent reaching $606bn, down significantly from its previous 9.4 per cent prediction.

However, the firm has jacked up IT spending in the US for the remainder of 2008 - it now says the market will grow 5.4 per cent hitting $572bn. Back in May it predicted growth of 3.4 per cent.

Since then global economic woe has deepened. On Monday America's financial institutions were sent reeling, after the country's fourth-largest investment bank, Lehman Brothers Holdings, filed for bankruptcy. ®