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Last month, Gartner unveiled its IT spend forecast for 2022 in a report and webinar led by John-David Lovelock, research VP and distinguished analyst for Gartner. 

Despite widespread concerns over dwindling attendance at key tech conferences, and executives struggling to combat supply chain disruptions caused by the pandemic, Gartner predicts that 2022 will see a noticeable upswing in global IT spending – the total amount is expected to reach $4.5 trillion by the end of 2022, a 5.1% increase from last year’s figures.

“2022 is the calm after the storm,” Lovelock said at the start of the webinar. “We’re starting to see markets get back to a more traditional growth pattern, and buying behavior is a little bit more predictable … We are hitting a new stride.”

Certain industries have yet to recover from the pandemic. Gartner identified airline transportation, offline entertainment, and industrial process manufacturing as some harder-hit examples. However, Lovelock noted that most CIOs seem less interested in “battening down the hatches” and slashing budgets until this fiscal storm passes, and would instead prefer to be bolder and riskier with their investments.

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For example, Gartner’s research indicates that 57% of boards of directors have increased, or are expected to increase, their “risk appetite” through 2022 and have indicated an interest in shifting their overall spending from “buy” to “build,” as enterprises across the world look to “[take] the shackles off old biases and old business models,” according to Lovelock.

But what, exactly, do CIOs plan to “build” with this recent surge of investment spending? Gartner identified three major areas of fiscal focus through 2022 for most enterprises: people, data, and technology.

CIOs look to plug the IT skills gap

In the midst of “The Great Resignation,” in which countries are unable to fill positions at record levels — over 50% in some countries — Lovelock identifies the growing tech skills gap as a growing concern for most organizations. In most instances, according to Gartner, this is due to workers’ fundamental issues with both insufficient salary increases (at least compared to global inflation) and an increasing desire to maintain a proper work/life balance.

Lovelock notes that while the average increase in salary for workers hovers around 3%, this average won’t be enough to compete or adequately compensate for the 2021 inflation rate of 6%. This, in turn, has ostensibly fueled momentum for many people to switch jobs throughout “The Great Resignation,” which some have argued should instead be named “The Great Reshuffle.” Furthermore, there’s a seemingly good reason to “shuffle” now. As opposed to the reported 3% salary increase for workers who stay put at their current job, Gartner said that those who switch jobs are expected to receive a 5% increase in salary. 

Beyond compensation and keeping up with inflation rates, employees are looking for more than money from employers. Back in 2018, maintaining a work/life balance was barely a consideration for most employees, according to Lovelock. Now, in 2022, an employer’s willingness to provide a proper work/life balance is considered as either the first or second priority for workers across all age groups.

Thus, Lovelock says, in order to attract and retain new employees, employers need to craft their job listings carefully, emphasizing the qualities that are most desirable for potential applicants, in order to acquire the workforce that most enterprises will need to continue to grow in 2022.

Funding grows to support the hybrid workplace model

For now, how do CIOs hope to slow the flow of departing workers? The plan appears to be to accommodate their desire for a hybrid workplace – by the end of 2021, almost all employees surveyed stated a desire to work remotely (at least one day a week, according to Lovelock) with “some time” spent in the office. Therefore, spending is expected to increase for technology (3.3%) and enterprise software (11%) to bolster workplace collaboration, cybermesh security, dynamic project workflow, and workplace analytics, all of which are meant to support an increasingly hybrid or remote workforce.

According to Gartner’s research, IT spending has already shifted. Reimbursements for internet access, for example, have seen a substantial increase in spending in recent years, and are expected to increase until 2025. Further easing a hybrid work model, cloud spending finally surpassed non-cloud spending, and should double the size of the non-cloud market by 2025, according to Gartner.

However, Lovelock cautions, the technology that CIOs choose to buy and implement needs to focus on more than simply ensuring that workers can access the internet and accomplish tasks remotely and securely. It should also allow venues for professional growth and self-service. Remote employees tend to feel excluded, Lovelock says, and if their technology no longer works for them, they no longer do work for their company.

Forging new connections – and embracing newer tech

While CIOs seek to accommodate employees’ new demands for a hybrid workplace, they’re seemingly also interested in finding more immediate ways to maintain productivity and profit. Alongside Lovelock’s encouragement to find ways to support current workers, most CIOs appear to be looking outside their workplace for new talent and newer technology.

Another notable consequence of the increasing skills gap in 2022 is that most IT departments and CIOs are expected to turn away from “in-house” internal services to managed services, in which consultants are invited to alleviate the stress of employees who choose to remain within an organization. As such, IT spending will undoubtedly increase on outsourcing markets, including infrastructure and app managed services, as well as hardware support.

Moreover, as more and more industries and IT departments aggressively pursue hyperautomation to optimize digitization at the task-based level, CIOs may hope to reduce or outright prevent the amount of manual effort required by pre-existing employees. Technology such as digital twins, IoT platforms, virtual assistants, and data fabric are expected to receive considerable funding and attention in the coming years. 

When it comes to new technologies, Lovelock indicates that companies in 2022 “have a new appetite for risk.” However, they’re choosing to “play it safe” with their current workforce, and are finding ways to retain the talent they have while making their workplace more attractive and sustainable for future employees.

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