IT spending in Ireland to hit €2.9 billion in 2009

7 Oct 2009

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The IT sector is tipped to lead most of the world’s economies towards recovery from the worst recession in more than 50 years, and in Ireland IT-using organisations are tipped to generate 8,000 new jobs for Irish IT professionals and outpace overall economic growth.

A study by IDC into the relationship between IT, software, the Microsoft ecosystem and the Irish economy found that IT spending in 2009 will be €2.9 billion ($4.3 billion). From the end of 2008 to the end of 2013, IT spending will grow 0.4pc a year, compared to GDP growth of -1.3pc a year.

IT-related activities will generate €4.8 billion in taxes in 2009. Over the next four years, IT-related taxes are expected to increase to nearly €5 billion.

That spending growth means that employment in the IT industry and of IT professionals in IT-using organisations will rise by 8,000 jobs in the four years from the end of 2009 to the end of 2013, up from a 2009 base of 148,000.

That represents growth of 0.4pc a year from now through 2013, while overall employment is expected to shrink.

Software drives activity in the services and distribution sectors, as well as in IT-using organisations, which means that while spending on packaged software will be only 19pc of total IT spending in 2009, 52pc of IT employment will be software-related.

The IT market will drive the creation of nearly 150 new businesses between now and the end of 2013. Most of these companies will be small and locally owned organisations.

As reported earlier today on siliconrepublic.com, the IT industry is going to generate 5.8 million new jobs in 52 countries worldwide over the coming four years. Many of these new jobs will be in 75,000 new business, mostly small IT start-ups.

As a group, companies in the Microsoft ecosystem in Ireland will generate more than €989 million in revenues for themselves in 2009. For every euro Microsoft will make in Ireland in 2009, companies in the local ecosystem will make €9.22.

To generate those revenues, companies in the local ecosystem will drive nearly €328 million of investment, most of it in Ireland.

Companies in the Microsoft ecosystem in Ireland employ 41,000 people; IT-using organisations employ another 17,000 IT professionals who work with Microsoft software or the products and services based on it.

By John Kennedy

Photo: A spending growth in the IT sector in 2009 means employment in the IT industry and of IT professionals in IT-using organisations will rise by 8,000 jobs in the four years from the end of 2009 to the end of 2013, up from a 2009 base of 148,000.

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Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com