Businesses ramp up IT spend, Syscap reveals

Tuesday 14 January 2014

Businesses are focusing on their IT infrastructure, new figures suggest, indicating that technology will be a greater priority for firms going forward.

According to research from independent finance provider Syscap, with the financial crisis now behind them, companies are willing to put more money into IT.

In 2013, spending increased by nine per cent on infrastructure ranging from tablets to data centres.

Over the last 12 months, IT investment via leasing in the past 12 months totalled £1.5 billion, up from £1.37 billion in 2012.

With greater emphasis being placed on technology, IT contractors are likely to find themselves in greater demand.

Indeed, conditions are ripe for freelancers in the sector, with technology and digital industries continuing to expand.

Research from Intellect, e-skills UK and the British Computer Society (BCS) shows the gross value added by the information economy has now reached as high as £72 billion. This accounts for five per cent of the total in the UK as a whole and five per cent growth over the course of the year.

Figures also revealed that the value added by each individual in the industry is now an average of £99,000 - over twice the all-industry mean of £47,000.

This is certainly justified, however, with the quality of workers in IT known to be high. Nearly two-thirds are educated to degree level, while six out of ten information economy workers are in professional positions.

IT contractors certainly help to raise the quality of the sector, offering the specialist skills needed to extract value from data.

Nevertheless, value depends on the infrastructure in place. Luckily, businesses are now funnelling money into IT following the boom in the use of cloud storage.

Philip White, chief executive officer of Syscap, said: "Investment in IT by British businesses can be a huge catalyst for economic growth. It has a massive impact on how efficient and globally competitive UK plc can be.

"Cloud computing has completely changed the landscape of data storage globally. Businesses around the world have moved hundreds of thousands of terabytes of data out of in-house storage to the cloud over the past few years."

To help manage IT infrastructure and to meet demand for digital services, between 2009 and 2012 the number of workers in information economy industries increased by eight per cent - this is considerably higher than the two per cent growth in the UK experienced more generally at the time the financial crisis hit.

There is now around 760,000 people in the sector, comprising three per cent of the UK's workforce.

Intellect’s Julian David said: "Tech in the UK sits at the heart of all kinds of activities and advances, from education to energy and from finance to fashion. This research is a timely reminder that continued economic recovery is critically dependent on digital expertise - and that the UK tech sector is well placed to lead it."

The skills shortage is also driving demand for expertise and freelancers are now well placed to take advantage of conditions created by the strengthening economy.

By Victoria McDonnell

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