IT budgets, salaries and staff turnover rates have returned to pre-recessionary levels, according to a new survey conducted by the Society of Information Management (SIM) that indicates increasing optimism among CIOs and IT executives nationwide.
IT executives say their departments are better positioned then ever to meet the needs of their organizations, whether that is by reducing business expenses through automation or by bringing new services quickly to market.
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"This survey shows the success of IT departments and how they are working with their business partners to leverage IT and to reduce business expenses," said Jerry Luftman, lead researcher for the SIM survey and a professor at the Stevens Institute of Technology. "Companies aren't looking to IT as the first place to slice and dice."
The outlook for IT budgets is solid, with 83 percent of survey respondents reporting that their 2011 IT budget was greater than or equal to their 2010 IT budget. This figure compares to 48 percent reporting stable or growing IT budgets in 2009.
Similarly, 85 percent of IT executives are predicting that their 2012 IT budgets will be greater than or equal to their 2011 figures. Only 65 percent of respondents made this prediction two years ago.
Another positive indicator is that IT budget allocations will remain steady in 2012, with internal staff expected to receive the largest share of the pie at 37 percent of spending compared to 38 percent this year.
The SIM survey indicated no plans by management to increase offshore outsourcing, which has been a fear among IT professionals over the years. CIOs reported that they spent only 2 percent of their 2011 IT budgets on offshore outsourcing and 3 percent on domestic outsourcing. For 2012, they are projecting the same level of investment for offshore and domestic outsourcing.
Another indicator that IT departments were returning to pre-recessionary levels of activity is that 2011 IT budgets represented 3.55 percent of corporate revenues, which compares to 3.5 percent prior to the recession.
Similarly, IT staff turnover rates returned to 7.06 percent in 2011, which compares to pre-recessionary level of 7.2 percent. The turnover rate peaked at 8.4 percent in 2008, when layoffs were common.
"It's pretty neat that the staff turnover rate is so low," Luftman said. "It's low for a couple reasons. Baby boomers are not retiring because they can't afford it, and people aren't finding other jobs with higher salaries. But the entry-level job market is terrific."
As far as salaries are concerned, 92 percent of CIOs say that their 2011 IT staff salaries were greater than or equal to 2010 levels. This compares to 81 percent reporting stable or increasing salaries in 2009 and 83 percent in 2010.