COVID-19 Doubles Permanent Remote Positions, Improves Productivity; IT Budgets expected to grow +2% y/y in 2021 from 2020's -4% y/y declines
Executive Summary
IT decision-makers project the overall number of employees working remotely to shrink in the next six months while permanent remote positions to roughly double compared to the pre-pandemic period. Most IT decision-makers report that they have seen a slight improvement in productivity, and IT budgets are expected to swing back to growth in 2021.
Key Findings
- Q4 IT spend is trending towards a decline of -3.7% y/y, which is a marginal sequential improvement from the Q3 data (-4.9% y/y). This caps off a year which saw 2020 total IT budgets fall -4% vs. original +4% growth coming into the year. 2021 budgets appear more optimistic, with an expected return to growth (+2.0% y/y), led in part by the Retail/Consumer, Services/Consulting, Health/Pharma, and IT/Telco industries.
- Cybersecurity and cloud migrations are the top-of-mind priorities heading into 2021, followed by collaboration software and analytics / data warehousing.
- 48.6% of IT decision-makers report that productivity has improved since workers began working remotely. We dissect organizational impact by company size, sector and geography in the report.
- The portion of the workforce permanently working remotely is expected to roughly double after the Pandemic (16.4% to 34.4%), a byproduct of positive productivity trends. This shift will have profound implications beyond just IT architectures, extending across real estate to hospitality to government policies.
- Fewer organizations expect to freeze hiring compared to last quarter and there will also be a drop in the number of IT projects frozen.
- Fewer vendors have been providing flexibility on payments compared to the previous quarter. 55% of vendors have not provided flexibility on payments, contract length, or license/subscription fees.