Business and IT Services revenue to grow 4.7% in 2024: IDC

Worldwide IT and Business Services revenue is expected to grow to $1.28 trillion in 2024, or 4.7 percent (in constant currency).
IT services forecast for 2024 IDC reportThe IT and Business Services market revenue grew 4.6 percent from $1.17 trillion in 2022 to $1.22 trillion in 2023, according to IDC Worldwide Semiannual Services Tracker.

Enterprise demand for cloud and digital transformation services remained strong, driving an uptick in growth in the second half of 2023 compared to a deceleration seen in the first half of the year. Support Services and Managed Services drove most of this uplift, with the largest improvements seen in managed services.

The trend towards cloud-based services is a driver for markets within managed services, as companies recognize the need to leverage scalable infrastructure while reducing costs and improving flexibility; IT Outsourcing, Key Horizontal BPO, and Network and Endpoint Outsourcing Services drove these rebounds in growth. On the flip side, the Project Oriented market (professional services), saw a slight slowdown in 2023.

“Continued delays in decision-making and a tightening of end user spending, particularly on smaller projects, contributed to market softening but there are some bright spots during these uncertain times through migration and modernization service offerings,” said Eileen Smith, program vice president, IDC Data and Analytics.

In terms of primary markets, while the Project Oriented market is still expected to outperform Managed Services and Support Services, achieving a 6.1 percent CAGR across the observed period, its momentum is expected to slow down, especially compared to the robust growth seen in 2022.

Geographically, IDC has raised its outlook for the Asia Pacific region and the Americas while growth was adjusted downward mainly for Europe, the Middle East, and Africa (EMEA).

Jason Bremner, research vice president, Worldwide Services, said: “The outlook for spending growth in the worldwide services market over the next five years will be higher than the average spending growth we saw in the past 15 years, indicating the underlying market drivers for business and IT services remain strong.”

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