Government IT spending to dip 0.6% in 2020 and grow 3.3% in 2021

Worldwide government IT spending is forecast to decrease 0.6 percent to $438 billion in 2020, according to forecast by Gartner.
Government IT spending forecast for 2020
Government spending will be $152.69 billion (nil growth) on IT services, $103.76 billion (+4.4 percent) on software, $62.54 billion (–2.4 percent) on telecom services, $62.74 billion (–0.9 percent) on internal services, $29.78 billion (–8.3 percent) on devices and $26.16 billion (–7.2 percent) on data centers in 2020.

In 2019, government IT spending grew 3.9 percent.

The report indicated that government IT spending will increase 3.3 percent to $452.3 billion in 2021.

Global government IT spending will represent 16 percent of total enterprise IT spending across all industries in 2020.

Enterprise IT spending across all industries will drop 8 percent to $2.7 trillion in 2020, Gartner report indicated earlier.

“Government organizations are accelerating IT spending on digital public services, public health, social services, education, and workforce reskilling in support of individuals, families and businesses that are heavily impacted by the COVID-19 pandemic,” said Irma Fabular, senior research director at Gartner.

IT services will continue to be the largest IT spending segment among governments in 2020, while software spending will experience the strongest growth, with an increase of 4.5 percent in 2020.

Important but less urgent IT projects, such as enterprise resource planning (ERP) and robotics process automation (RPA), will be delayed to make room for immediate and critical spending in digital workplace support, public health response and economic growth.

Adoption of cloud services will continue to accelerate while spending on in-house servers and storage will continue to decline.

Government IT spending in North America will be the largest globally, reaching $191 billion in 2020, followed by Western Europe ($94 billion) and Greater China ($39 billion).

Digital government services, data and analytics, cybersecurity as well as citizen engagement and experience will continue to be spending targets for the public sector.

Government spending will be $158.22 billion (+3.6 percent) on IT services, $112.24 billion (+8.2 percent) on software, $64.54 billion (+3.2 percent) on telecom services, $60.46 billion (–3.6 percent) on internal services, $29.74 billion (–0.1 percent) on devices and $27.08 billion (+3.5 percent) on data centers in 2021.

Rajani Baburajan

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