Since the COVID-19 pandemic swept the globe, the IT product sector has experienced a consumption boom. Furthermore, driven by the development of high-quality content such as 4K and 8K, as well as IT technologies like AI, autonomous driving, connected cars, and cloud services, related IT spending recorded record-breaking growth last year. This year is experiencing a sluggish boom compared to last year, and with the device sector facing a downturn, tension is rising regarding changes in the global market and trends in the domestic industry.

■ Which spending sectors are strong amidst negative device growth? On the 25th, Gartner projected that global IT spending in 2022 would reach $4.5 trillion, a 3% increase from last year, while overall device spending was expected to decrease by 5% due to reduced consumer spending on PCs, tablets, and printers.

Spending on data center systems is projected to increase by 11.1% in 2022, marking the highest growth rate among all sectors. Cloud consulting, deployment, and management services are estimated to grow from $217 billion last year to $255 billion in 2022, boosting the IT services sector by 6.2% this year. Domestic IT spending is projected to record a growth rate of 3.3% in 2022, reaching approximately 96.7 trillion won. Domestic data center systems are expected to become the fastest-growing sector, recording a growth rate of 15.1% this year, while the device sector is projected to experience negative growth in line with global trends, but with a somewhat moderate decline of -2.3% continuing into next year.

While the domestic data center system sector continues its boom with 23.2% growth last year and a 15.1% increase in spending this year, the growth rate is expected to slow significantly in 2023, projected to be only 1.9%. The software sector has shown moderate growth each year.

In addition, global spending on software is estimated to reach $902.1 billion in 2023, an 11.8% increase, following $806.8 billion in 2022, a 9.6% increase.

John David Lovelock, Vice President of Gartner Research, who is concerned about the inflation situation, said, “While all central banks around the world are focusing on measures to address rising prices, inflation will not decrease until the end of 2023.”

On the other hand, Vice President Lovelock argued, “The current levels of volatility in inflation and exchange rates are not expected to hinder CIOs’ investment plans in 2022,” adding, “Companies that do not invest in the short term are likely to fall behind in the medium term and risk not existing in the long term.”

As inflation and distribution uncertainty worsen due to Russia's invasion of Ukraine, CIOs and companies are widely shifting from IT ownership models to service-based models.

Accordingly, Gartner projected that spending on the cloud sector would grow by 18.4% in 2021 and 22.1% in 2022. Furthermore, Gartner predicted that not only is the demand for cloud services reshaping the IT services industry, but spending on servers will also increase by 16.6% in 2022 as hyperscalers build data centers.

■ The Impact of IT Personnel Shortages on IT Spending
The global shortage of core IT skills is expected to be resolved by the end of 2023. This is likely to be influenced by the enhancement of existing employees' capabilities and retraining at a time when the momentum of companies seeking to complete digital transformation is slowing.

Gartner emphasized that Chief Information Officers (CIOs) must take action as soon as possible to strike a balance between increasing IT demand and declining IT workforce levels.

As the size of the IT workforce market continues to shrink, attracting and retaining talent is becoming increasingly difficult. According to a global labor market survey conducted by Gartner in the first quarter of 2022 involving approximately 18,000 employees, compensation was found to be the number one factor in attracting and retaining IT talent.

Technology service providers are raising IT service prices to offer competitive rates. Gartner analyzed that this is expected to impact the growth of spending on software and IT services through 2023.

Increased spending on IT services is projected to grow by 6.2% in 2022, a slight slowdown compared to last year's 12.8% growth rate, but is expected to reach approximately 1.38 trillion won in 2023 with a growth rate of 8.3%, an increase from last year.

Vice President Lovelock stated, “CIOs are using more IT services to compensate for the lack of skilled IT staff,” adding, “While tasks requiring low-level technical skills tend to be outsourced to managed service firms to reduce employee working hours, critical strategic work requiring advanced skills that many companies cannot obtain will increasingly be handled by external consultants.”