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Government IT spending to grow 6.8% in 2023

Worldwide government IT spending is forecast to total $588.9 billion in 2023, an increase of 6.8% from 2022, according to Gartner, Inc.

“Government organizations are continuing to modernize legacy IT and invest in initiatives that improve access to digital services as constituents increasingly demand experiences that are equivalent to online customer interactions in the private sector,” said Daniel Snyder, Director Analyst at Gartner. “The total experience (TX) framework, which helps agencies manage employee and citizen interactions, is enabling transformation and will remain among the main drivers of IT spend in 2023.”

Along with improving the citizen experience and engagement, a cohesive TX strategy will help governments advance digital skills and literacy in their workforces by providing modern tools and approaches to lessen friction in government work. Failing to build a solid TX strategy increases service friction, leading to risk of service delays and underwhelming service experiences.

In 2023, government IT spending is forecast to increase across all segments except devices, as government end-users extend the useful life of their devices that were acquired at the onset of the pandemic (see Table 1). Software will be the highest growing segment in 2023 followed by IT services and internal services.

Table 1. Worldwide Government IT Spending Forecast(Millions of U.S. Dollars)

 

2021 Spending

2021 Growth (%)

2022 Spending

2022 Growth (%)

2023 Spending

2023 Growth (%)

Data Center Systems

23,110

7.0

25,042

8.4

25,156

0.5

Devices

37,520

11.6

34,794

-7.3

34,667

-0.4

Internal Services

68,469

-1.9

67,119

-2.0

68,602

2.2

IT Services

185,564

10.8

193,925

4.5

209,261

7.9

Software

148,962

16.2

162,803

9.3

183,103

12.5

Telecom Services

71,757

1.4

67,775

-5.5

68,209

0.6

Total

535,382

8.9

551,458

3.0

588,998

6.8

Source: Gartner (December 2022)

Initiatives such as migrating services to the cloud, modernizing applications, and fortifying network security are among the primary innovation priorities that governments are focused on to improve public engagement and satisfaction.

CT Bureau

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