IT staff cuts top list of budget reduction plans

IT staff salaries and benefits continue to be the largest part of the IT operating budget

Companies trying to cut IT budgets are laying off staff and reducing compensation and benefits for remaining employees, new survey results show.

What not to cut from IT budgets: Staff

2009 IT budgets and spending: a snapshot

A majority of more than 1,000 enterprise IT decision makers in North America and Europe resorted to hiring freezes, staff reductions or pay and benefits decreases in an effort to lessen IT budgets and spend, Forrester Research reports.

Enterprise IT executives reported that nearly 70% of their IP operating budget allocation goes toward ongoing operations and maintenance, and for North American IT leaders more than one-quarter (26%) of that budget is spent on salary and benefits for full-time IT staffers. In Europe, 22% of similar operating budgets is dedicated to maintaining staff.

"IT staff salaries and benefits continue to be the largest part of the IT operating budget," the Forrester report reads.

"Hiring freezes and layoffs top the list of actions that firms expect to take this year as a result of current economic conditions."

Survey data reveals that 61% of enterprise IT firms said they expect to reduce staff headcount in 2009 compared with 2008, with 23% of those planning to reduce staff by 5% or more.

"Compensation for IT staff also takes a hit, as 54% of firms plan for decreases," the report adds.

On the SMB front, Forrester found that staff cuts weren't the first place the smaller companies looked to make cuts. The research firm polled more than 1,250 SMB IT decision-makers between February and May 2009.

More than half of SMB IT departments will maintain the same headcount they had compared with 2008, but about 30% plan to decrease staff, and 13% report they will reduce staff by 5% or more.

SMB IT decision makers also report similar results for pay and benefits, with 50% intending to maintain 2008 levels and 31% expecting decreases in 2009.

"Hiring freezes top the list of actions that firms expect to take as a result of current economic conditions, followed by reducing the use of contractors and consultants, and deferring of capital investment," the report states.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags IT budgetsstaff managementlayoffsIT budget cutsIT jobsIT staff

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Denise Dubie

Network World
Show Comments

Cool Tech

SanDisk MicroSDXC™ for Nintendo® Switch™

Learn more >

Breitling Superocean Heritage Chronographe 44

Learn more >

Toys for Boys

Family Friendly

Panasonic 4K UHD Blu-Ray Player and Full HD Recorder with Netflix - UBT1GL-K

Learn more >

Stocking Stuffer

Razer DeathAdder Expert Ergonomic Gaming Mouse

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?