UK tech sector is optimistic for the year ahead despite economic downturn

UK tech firms are optimistic about the health of the industry going forward despite the current and predicted long-term economic turmoil., a new report from CompTIA, the non-profit association for the information technology (IT) industry and workforce, has found.

CompTIA’s IT Industry Outlook 2023, an annual report that analyses the sentiment of technology firms for the year ahead, revealed that businesses in Britain rated the health of the sector at 6.4 out of 10, suggesting that even with current uncertainties and societal issues, the industry remains in a robust and confident mood. However, despite the largely positive sentiment, the UK, along with other European regions (DACH - 6.4/10; BENELUX - 6.4/10), were the least optimistic surveyed, with the U.S. (6.8/10), Southeast Asia (ASEAN - 7/10) and Australia and New Zealand (ANZ - 7/10) feeling more encouraged about future prospects.

This positivity also was reflected in the UK’s channel industry, with 53% of companies optimistic about their firms’ prospects for 2023 and only 23% feeling uneasy about the year ahead. At the same time, many channel organisations are bullish when it comes to their growth potential, with 27% saying they expected their revenue and profitability numbers to exceed those of 2022 if the tech sector flourished. A more cautious 45% said they expect stable results on par with the previous year, while roughly 24% said they still expect a decline in revenue and profitability even if the tech industry performs well. 

Although there is a lot of positivity in the industry, concerns linger amongst IT teams around the allocation of resources, with more than a third (36%) being concerned that their technology budgets will be too low in the year ahead. This despite 75% of companies believing that their technology budget in 2023 will be the same or higher than it was in 2022.

William Remes, vice president of EMEA at CompTIA, said: “From the lingering effects of the pandemic through to economic uncertainty and a looming recession, the technology industry has had to face a lot of challenges in recent times. Despite this turmoil, it is great to see that businesses working in the sector are feeling largely hopeful and optimistic for the year ahead. 

“This is not to say that there aren’t still difficulties to overcome, as the report shows. However, we are confident that through working together and learning lessons from what we’ve been through, the industry and those in it can continue to grow and thrive in 2023 and beyond.”