Forrester Says Tech Downturn Is "Unofficially Over" 130
alphadogg writes "The US IT market will grow by 6.6% as high-tech spending rebounds in 2010, according to Forrester Research's latest estimates. The research firm based its projections on data reported for 2009, though its fourth quarter numbers are incomplete. Forrester says hints of a recovery surfaced in the third quarter, and now the company expects the global IT market to grow by 8.1% in 2010. Forrester's US and Global IT Market Outlook: Q4 2009 reads: 'The tech downturn of 2008 and 2009 is unofficially over, while the Q3 2009 data for the US and the global market showed continued declines in tech purchases (as we expected). We predict that the Q4 2009 data will show a small increase in buying activity, or at worst, just a small decline.'"
Re:Anectodal info (Score:3, Informative)
We had a 2% cut in staff at the end of 2008. The 2% came from early retirement and not replacing people. There were a few small departments that were eliminated. Some of the people were absorbed into other departments, but not all. We haven't really added any FTE to our head count, but we have gone through a few contractors.
There were some other cuts. No company picnic at 6 flags in 2009. The holiday dinner at a nice steak house was moved to a less pricey Italian restaurant. Our company is spread out and travel was drastically cut. When we did travel the trips were very short.
I didn't loose my job, and I bought a new car in 2009. However, I know a few of those contractors would have like to stayed around longer after their contracts expired. Instead of hiring 10 people at the start of 2010, my boss is being told that she has to wait until Q3.
Re:Anectodal info (Score:4, Informative)
The U.S. job situation is made further worse by population growth, which is currently running around 1% annually in the U.S. (~3 million per year). After adjusting for deaths and retires, that necessitates, on average, an additional 100,000 - 150,000 new jobs to be created each month just to stay even.
Or to put it another way, in the 00s decade, there was roughly zero net job growth - there are about as many jobs today as back in 2000, but the U.S. population has grown by about 25+ million in that same time. Many of the jobs that exist today tend to pay less, when adjusted for inflation, than jobs did back 10 years ago.
Ron
Re:It may be true (Score:4, Informative)
If it paid the salary, I wouldn't care if I was paid to just keep one Windows Small Business Server PC up and running. You get what you can take in this economy. No, it wouldn't be as fun as a rackful of high end suns with a root prompt just waiting for you, but it is better than nothing.
Re:Recovery? (Score:3, Informative)
On the loan, yes. But you're overlooking what is, in many locales, the fastest growing homeowner expense, property taxes.
So while your fixed rate mortgage payment on the asset will stay the same, don't expect the same for property taxes.
There are many people paying over of 30%, in some instances upwards of 50%, in addition to the mortgage rate they were originally quoted.
For example, an 6% fixed rate loan for a home at $200,000, assuming 10% down, would come out to around $1100 monthly payment. Sounds pretty good. But in some places, property taxes on a property of that amount could easily top $6000 per year ($500+ per month!). More to the point, property taxes is often a large expense and likely to greatly increase over time faster than inflation.
And to make matters worse, especially for houses under homeowner associations, special assessments, which are often not limited by law - that is to say, the roofs need to be replaced, road replacement, sewer repairs, etc can easily run upwards $10,000 per housing unit - this not theoretical either ... I've known several people caught in such a situation and having to quickly borrow large sums of money to pay it. Special assessments are not limited to just home owner associations, though more common with them, in that many municipalities will require the homeowner to pay for sidewalks/curbs, sewer / water line installation/replacement, etc.
In short, don't automatically assume real estate is the safe place to be in an inflationary environment, because it may not be unless one buys in an area with low property taxes and is relatively certain they won't increase much nor get hit with special assessments.
Ron