British business will reduce spending on tech because of Brexit

 
Lynsey Barber
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IT spending will be put on hold by many businesses (Source: Getty)

Tech spending will take a hit from Brexit across the world as businesses continue to hold back amid the uncertainty.

Hiring tech staff will likely be the first area where companies dial back in the immediate future, analysts at Gartner predict, while price increases are expected and major projects requiring investment will be put on hold until at least 2017

"While the UK has embarked on a process to change, that change is yet to be defined," said research president John-David Lovelorn.

"The Leave vote will quickly affect IT spending in the UK and in Europe while other changes will take longer. Staff may be the largest immediate issue. The long-term uncertainty in work status will make the UK less attractive to new foreign workers. Retaining current non-UK staff and having less access to qualified new hires from abroad will impair UK IT Departments," he added.

Global IT spend will be flat for the year at $3.4 trillion according to Gartner's latest IT spend forecast, a slight rise from the 0.5 per cent previously estimated thanks to currency fluctuations. However, the estimates do not take into account Brexit and with the terms of leaving the EU still undefined, there is likely to be an impact on how much businesses will spend on technology such as infrastructure, staff and PCs, Gartner said.

This will reverse growth in IT spend sending into negative territory next year with growth estimates of 1.7 per cent this year likely to be as much as five per cent lower, Gartner calculates.

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