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Irvine, Calif. – Companies in the energy and utilities sector, already moderately big spenders on IT, plan to increase their IT operational spending this year at a rate faster than other sectors , according to the annual Computer Economics IT spending and staffing study.
The Irvine, Calif.-based IT research firm found that energy and utility companies plan to bump IT operational spending this year by 3.1%, which is a modest increase by historical standards but will ahead of the 2.3% increases across all organizations in the 2013/2014 study period.
IT operational spending makes up the lion’s share of IT spending by organizations because it includes salaries and benefits for IT workers. The rise in IT operational spending, however, is not translating into an increase in headcount. IT staff headcount remains flat at the median and only one-third of these organizations plan to add IT staff this year. Other operational expenses for such costs items as data and telecom service, outsourced services, depreciation, software maintenance, and leased equipment.
“With the oil and gas boom and improving economy, there is no surprise these companies are spending more on IT as they grow revenue and expand operations,” said John Longwell, vice president of research. “What is somewhat puzzling is the lack of job growth. Most of the increase is services related.”
The study includes oil and gas producers, pipeline operators, electrical transmission operators, gas and electric utilities, and water and power utilities in the energy and utilities sector.
Capital budgets are also rising for these organizations. IT capital spending plans are up a median 4.9%, which is also ahead of the composite median growth of 4%. Capital spending makes up about one-quarter of total IT spending by organizations and mostly includes spending on hardware and software acquisitions and application development projects.
About the Study
The Computer Economics IT Spending and Staffing Benchmarks study, now in its 24th year of publication, provides key metrics to assist organizations in the financial and strategic management of information technology. Each year, we conduct an in-depth survey of IT executives in the U.S. and Canada to gather detailed metrics concerning their IT spending and staffing levels, use of outsourcing, and adoption of IT management best practices. The 2013/2014 study is based on a survey of more than 200 IT executives conducted in the first half of 2013. It provides composite statistics of IT spending and staffing data, a segmentation of the same statistics by organization size, and individual chapters for 20 sectors and subsectors. Additional findings along with a description of the study’s content, design, demographics, and methodology can be found in the free dowload of the executive summary.