According to Forrester’s ‘Global IT Services Market Forecast 2023-2028’, global IT service industry spend will reach $2 trillion in 2028. However, despite forecasted growth, IT service firms will face several challenges in the next few years.
Key findings include:
- Growth will be substantial, with the IT service industry averaging 4.6% annual growth. Growth will be fastest in the Asia-Pacific region, reaching almost 6%.
- In the near-term, growth will largely be driven by financial services, managed services and cybersecurity. Ten of the largest IT service companies saw 44% of their revenues come from financial services, manufacturing, and energy.
- GenAI is reshaping how services are delivered. In the US, 57% of the jobs lost to automation in professional services will come from genAI. If genAI increases IT service productivity to lower project delivery costs, more resources would be available to reduce project backlogs.
“The IT service industry captures more than a third of annual global tech spend. By 2028, the annual spend will increase significantly to reach $2 trillion,” said Michael O’Grady, principal forecast analyst at Forrester. “Despite strong forecasted growth over the next few years, IT service firms must stay ahead of current challenges, including optimizing headcount for cost and efficiency, staying abreast of competition from software and engineering firms, and utilizing genAI judiciously to reshape service delivery. IT service companies that manage these challenges well will thrive and scale globally.”
