Like many business executives and consumers, I have been paying a lot of attention to the economic indicators, looking for signs either of a stronger economic recovery or a potential renewed recession. As a technology market analyst, I track economic indicators because I’ve found that the growth in the economy is one of the best predictors of what the technology market growth will be -- far better than surveying CIOs to find out their spending plans, which tend to be backward looking.
Based on my reading of the economic indicators and the forecasts of professional economists, it looks to me that both the US economy and the global economy will fall between extremes of strong growth or recession, growing weakly but not slipping back into recession. As a result, in Forrester's latest forecast (US And Global IT Market Outlook: Q3 2010), we have trimmed our forecasts for the US tech market to a still-robust 8.1% growth for 2010 (down from our 9.9% forecast in July), with 7.4% growth in 2011. Globally, the tech market measured in US dollars will grow by 7%, compared with our July forecast of 7.8%, with the somewhat weaker outlook for the US tech market offsetting slightly better performance in Europe and strong growth in Latin America, the Middle East, Africa, and Asia/Pacific.
These forecasts include business and government purchases of computer equipment, communications equipment, software, IT consulting and systems integration services, and IT outsourcing. If we add telecommunications services (as we do for the first time in this report), US information and communications technology (ICT) market growth in 2010 will be 5.6% and 6.6% in 2011.