The digital universe now rules our most basic daily functions. Worldwide, the use of handheld digital devices has exploded to the point of obsession. The great disrupter has now become the one constant in our world, and machine learning is about to take the quantum leap into every industry that you can think of.
Gartner says IT spending continues to climb. Fortune predicts an increase in spending on business technology from 6.7% to $2.1 trillion this year. This, despite the manageable costing that comes from SaaS and other cloud-driven models.
Given all these trends, how will technology spending change in the future and what industries will be carrying the biggest load of IT spend in 2017, and beyond?
This article looks at the forecasted technology spending for three industry sectors: Healthcare, manufacturing, and government, to determine who will be leading technology spending in 2017.
Tech Spending is Blowing Up Healthcare
When you consider that the Baby Boomer population is hitting their golden years, you would assume this would place the biggest drain on healthcare resources in the United States.
According to the New York Times, you would be wrong.
While the average age of the U.S. population is going to rise from 37.7 to 40 this year and the average citizen in this country is living a lot longer, it turns out the cost of technology will actually be the biggest drain on health care system budgets through the next few years. This is despite the fact that, by 2040, 37 of every 100 people will be over 65; populations that will most certainly require more resources from our health care providers.
The Times says that somewhere between one-third and two-thirds of health care spending is attributable to technology. While overall business technology spending this year include an appetite for more software and cloud models and a rising disdain for hardware, healthcare is the one sector that still utilizes a lot of on-premise equipment.
Manufacturing Sector Struggling to Adapt
PWC points out that the overall global demand for manufactured products is experiencing a slow growth phase, with foreign trade at an all-time low. Yet PWC analysts suggest this could be a time for factory-level technology innovations that could improve processes and fuel expansion. Creating digitally connected product lines that provide insight into production and improve operations are what create “remarkable opportunity” for the manufacturing sector. However, PWC points out the industry is risk averse and unwilling to increase technology spending. A July 2016 PWC report showed 30% of U.S. senior manufacturing executives said their companies were increasing technology spending in 2017. This is particularly startling when you consider that overall business trends show a virtual explosion of technology spending in almost every other sector.
Government Continues to Spend, Spend, Spend
According to Government Technology, a whole lot of your tax dollars are going to be allocated for tech expenditures in 2017. Check out these spending numbers, by government sector:
- Education $23 billion
- Environment and natural resources $7.4 billion
- Health and human services $26.4 billion
- Public safety and justice $7.6 billion
- Public works $7.6 billion
- Transportation $10.3 billion
The biggest concern of technology professionals in local, state, and federal government remains computer network security. Across all industry sectors, spending for technology and services to combat cyber terrorism is on the rise.
Trends tell us that our digitally connected global world is going to continue to expand. With a few exceptions, such as manufacturing, these businesses will continue to increase their technology spending. These trends will undoubtedly extend into the foreseeable future.