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CompTIA: IT Business Confidence up

Members of the U.S. IT sector are more confident now in their business prospects than they have been in the last year and a half, according to a new survey released by the Computing Technology Industry Association.

The CompTIA IT Industry Business Confidence Index -- measuring IT managers' and workers' confidence in their own industry, their own companies and the U.S. economy -- stood at 60 in December, the trade group said. The index, based on a survey of more than 1,100 IT workers and managers, asks respondents to rate their confidence in those three areas on a 100-point scale.

CompTIA launched the index in June 2009, and December's confidence numbers in the U.S. were the highest in the history of the index.

Global IT spending should grow by 4 percent in 2011, CompTIA predicted.

The U.S. index was up seven points between September and December, while the global index was up eight points, to 64. The confidence index was highest in Brazil and India, at 75, while it was lowest in the U.S. and South Africa among eight countries indexed.

CompTIA predicted that the confidence index will rise again in the next quarter.

"After several quarters of lackluster performance, an improving CompTIA confidence index should be welcome news to companies eager for economic stability," Tim Herbert, vice president of research for CompTIA, said in a statement.

U.S. IT workers and managers -- 41 percent of respondents were senior to executive management -- expressed most confidence in the IT industry and in their own companies. Confidence in the U.S. economy remained below 50 on the 100-point scale.

Forty-five percent of U.S. IT firms are planning to increase spending on new products and business lines over the next half year, and 43 percent plan technology-related investments, an increase of 10 percentage points from September, CompTIA said. Thirty-two percent of U.S. IT companies said they planned to increase hiring over the next six months, compared to 37 percent in September, the survey said.

Employment trends are "still cause for concern," Herbert said.

Worldwide, 52 percent of IT firms plan to increase spending on new product lines, and 51 percent plan to increase spending on technology. "With renewed market stability and optimism, businesses will likely start spending a bit more freely," the study said.

A number of factors could "potentially derail or minimize growth," the study said. IT executives remain concerned about weak consumer spending, government regulation and unexpected economic shocks such as increased oil prices, the study said.

Pent-up demand for IT products and services, along with strong sales in emerging markets and industries such as health care, will help the IT industry grow this year, CompTIA predicted. However, consumers could seek low-cost options for their IT products, resulting in high growth in unit sales, but modest revenue growth, the trade group said.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

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