CIO Survey shows serious impact to IT budgets

CIO Magazine ran a survey of 208 Chief Information Officers (CIO) and reported the results in an article titled “IT Budget & Staffing Survey Shows Bleak Year Ahead for CIOs, IT Staffs“.  The results aren’t surprising…or at least shouldn’t be surprising to anyone in the IT field.

Some highlights from the article:

  • More than half of IT heads (53%) now plan to slash budgets in response to unfavorable economic conditions
  • 59% of CIOs are implementing IT hiring freezes
  • A little over one third (34%) have begun reducing IT headcount
  • 35% of CIOs plan a decrease in compensation in the coming year
  • Nearly a third of CIOs (31%) say they plan to reduce their full-time, in-house staff
  • 48% of CIO’s plan to reduce spending for contractors and temporary workers
  • 46% of CIO’s are slashing their training budgets
  • 38% of CIOs say they are more likely to consider on-demand services and SaaS as a result of the unfavorable economic condition

Interesting results but not surprising. Anyone close to the IT field could see this coming.   I expect that these same percentages would apply to many other parts of the organization as well.

The results (or at least the reporting of the results) brings up a few questions:

  1. Which industries will be hit hardest?
  2. Who will be hit the hardest by any compensation decreases?  Frontline employees or IT Senior Leadership?  Both?
  3. If budgets are slashed now, at what point will the CIO and the rest of the organization determine that they should start spending money again?  Slashing budgets during a downturn does not get you ready for the upturn.
  4. What affect does this budget cutting have on employee morale and engagement?  Budgets decrease and most likely, morale decreases.

Jump over and read the rest of the results.

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