Monday, 24 August 2009

IT leads Britain out of recession?

(By Richard Holway 10.00pm Monday 24th Aug 09) Yes, you did read the title correctly. A study today from the Institute of Chartered Accountants reports that business confidence is back in positive territory with the biggest rise in two years. The ICA predicts a 0.5% growth in GDP in Q3.

Perhaps the most surprising part of the report was that "IT was the most optimistic sector, followed by banking, finance and insurance". The survey was conducted amongst 1000 chartered accountants - rather than CEOs (although many IT CEOs seem to be accountants these days!)

I have to admit that this doesn't match with our own findings. We still find most CEOs extremely cautious about the near term outlook. However the debate is not so much over "it's going to get even worse"; more "it's not getting any better". And, again, the diversity of outlook is more polarised than ever. Anything 'new' (project, package, staff etc) is still very difficult whereas "Make do and Mend" and "Can you save us money NOW?" continue to report good business.

I've long believed that "confidence" is the main reason for both boom and bust. So if 'confidence' is returning then you can be sure that growth is not too far behind. In IT we have long said that real growth will not return until Q3 2010. We'd be delighted to change that prediction...but just not yet.

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