IT consulting to thrive in NZ throughout 2022

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IT spending in Aotearoa New Zealand will continue to blossom, rising 7.4 percent to NZ$15.3 billion in 2022 with IT services taking the lion’s share of the total, according to Gartner’s latest forecast update.

This local growth rate outstrips the forecast global IT spending growth rate of 5.1 percent to hit US$4.5 trillion this year, Gartner has predicted.

Of the NZ$15.3 billion in NZ, IT services are expected to account for just over $4.5 billion, an 8.5 percent growth over 2021. Within that category, business and technology consulting spending, specifically, is expected to grow 8 percent to $764 million in 2022.

Services spending is also expected to grow even further in 2023 to surpass $5 billion, nearly a third of the total $16.1 billion spending for that year.

“2022 is the year that the future returns for the CIO,” said Gartner distinguished research vice president John-David Lovelock. 

“They are now in a position to move beyond the critical, short term projects over the past two years and focus on the long term. Simultaneously, staff skills gaps, wage inflation and the war for talent will push CIOs to rely more on consultancies and managed service firms to pursue their digital strategies.”

Gartner stated that spending on external IT consulting will be driven by organisations’ need to keep up with the accelerated pace of change that will “widen the gap between organisations’ digital business ambitions and their internal resources and capabilities”.

“This will be particularly poignant with cloud as it serves as a key element in achieving digital ambitions and supporting hybrid work,” said Lovelock. 

“Gartner expects the vast majority of large organisations to use external consultants to develop their cloud strategy over the next few years.”

An interesting trend to note in the spending forecast is the stagnation of communications services spending, growing little more than one percent per year, though maintaining its second-place spot in terms of total spend. 

While data centre systems was the fastest-growing segment in 2021 at 16.6 percent, that growth is expected to reduce significantly to 4.9 percent in 2022 before rising again to 9 percent in 2023 – though will still account for less than $800 million.

Enterprise software growth, by contrast, will remain high to steal that fastest growing segment spot for the next two years.

Gartner is also predicting that while the devices hotstreak will continue through 2022 with 9 percent growth, it will finally come to an end in 2023 dropping down by 9 percent.

CRN NZ is set to launch in the coming weeks. Contact NZ bureau chief Ben Moore for more information. 

New Zealand IT Spending Forecast (Millions of New Zealand Dollars)

Source: Gartner (January 2022)