Based on recent events related to the new coronavirus pandemic, Forrester Research is downgrading its forecast for the technology market for 2020, and in the best case forecasts a slowdown in the growth of the US and global technology market, which should be around 2% in 2020.
This assumes that the United States and other major economies experience economic decline in the first half of 2020, but recover in the second half. But the firm believes there is a 50% probability that global technology markets will decline by 2% or more in 2020, if a real recession occurs.
In both scenarios, spending on IT or communications equipment will be the lowest, with potential decreases of 5-10%. Spending on technology consulting and systems integration services will remain stable in the event of a temporary slowdown and could drop by 5% if companies actually reduce their spending on new technology projects.
Software spending growth will slow to 2-4% at best, and in the worst-case scenario will be zero in the event of a recession. Outsourcing of technology and telecommunications services will be more resilient, although contract revision could also lead to lower spending.
The only positive notes would be the continued growth in demand for cloud infrastructure services and the potential increase in spending on specialized software, communications equipment and telecommunications services; expenses for teleworking and distance education, companies encouraging their employees to work from home and schools for adopting online courses.