Analyst firm Gartner, predicts that global IT spend will reach $4.2 trillion in 2021 from $3.9 trillion in 2020, a year-on-year increase of 8.6%.

The largest areas of spending are communications services ($1.4 trillion projected for 2021) and IT services ($1.2 trillion), with the latter expected to grow more rapidly, primarily due to investment in cloud infrastructure to support remote working and continued digital transformation. John-David Lovelock, distinguished research vice president at Gartner, said in a press release:

“Technology spending is entering a new build budget phase. CIOs are looking for partners who can think past the digital sprints of 2020 and be more intentional in their digital transformation efforts in 2021. This means building technologies and services that don’t yet exist, and further differentiating their organisation in an already crowded market.”

Gartner’s projections are split across five categories, all of which are expected to expand in 2021 and into 2022. The highest projected growth rate is in enterprise software, at 13.2% in 2021 and 11.7% to $670 billion in 2022. Meanwhile, devices, which have seen a bumper 2021 thanks to the pandemic (13.9% growth), are projected to see much lower – although still positive – demand in 2022 (0.2%).

The IT services segment, which includes cloud, is projected to grow 9.8% in 2021 and 8.5% in 2022 primarily due to continued demand for IaaS. In 2020 the worldwide IaaS public cloud services market expanded by 40.7% in 2020, according to Gartner. While the firm has not yet broken out projections for IaaS in 2021/2022, it is likely that this trajectory will continue.

Recent research among UK IT leaders found that cloud IaaS/PaaS spending topped the shopping list, followed by end-user compute and then security software.