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You are here: Home / CIO Issues / Tech Industry Likely To Grow in 2011
Momentum May Drive a Tech-Industry Recovery in 2011
Momentum May Drive a Tech-Industry Recovery in 2011
By Jennifer LeClaire / CRM Daily Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
It's a thought-provoking headline, isn't it? After some ups and downs in 2010 -- welcome after the dips and twists of 2009 -- many industry watchers are bullish on a tech-industry recovery in 2011. The momentum that started to build in the second half of 2010 should continue next year as corporations and consumers alike loosen the purse strings.

Based on the information KPMG has received from U.S technology executives, Gary Matuszak, KPMG global chair for the information, communication and entertainment practice, is optimistic. In KPMG's most recent survey of tech executives, the firm found that business leaders expect significant improvement in 2010 over last year in revenue and employment, and they are more optimistic about next year.

"Almost nine out of 10 executives said they expect business conditions in the technology sector to improve in 2011, including stronger revenue," Matuszak said. "When participants were asked to name the biggest drivers of revenue growth over the next three years in the technology sector, 54 percent named cloud computing, 51 percent said mobile applications, 43 percent identified client computing/virtualization, and 42 percent said advanced analytics. About half the respondents believe the growth rate for both cloud computing and mobile applications could exceed 10 percent over the next two years."

Semiconductors Tell the Story

KPMG also recently completed a global survey of the semiconductor industry. Executives from that industry also expect solid increases in sales and workforce growth in 2011. According to the KPMG survey, conducted in collaboration with the Semiconductor Industry Association, 78 percent of semiconductor executives expect revenue to grow by more than five percent next year.

"In looking at jobs, 29 percent of the respondents predict workforce growth of greater than five percent, compared to 23 percent in 2009," Matuszak said. "Our findings show that the semiconductor industry expects moderate growth next year, which is extraordinary in the context of an uneven global economic recovery. The continuing demand for electronic products ranging from tablets to smartphones, and an increased demand for technology integration in automobiles, will buoy semiconductor manufacturers as the economy fluctuates."

Bellwethers and Startups

Rob Enderle, principal analyst at the Enderle Group, said 2011 looks like a great year for tech sales and intellectual-property attorneys. Year-end numbers are looking good from the majors right now, with the exception of Best Buy -- which took a hit from online sellers like Amazon -- and Yahoo, which is being horridly run, Enderle said.

"HP, IBM, Oracle outside of hardware, and Microsoft have all been strong coming into the end of the year, suggesting big business is buying again and the pent-up demand from lots of years of not replacing aging hardware should make for a strong 2011 if we don't have another financial crisis," Enderle said. "This last is a bit of a risk because the U.S. government isn't cooperating with itself very well at the moment and concerns of a double-dip recession are mounting as a result, which doesn't bode well for next year's sales."

Meanwhile, from an educational perspective, Professor Jonathan Askin at the Brooklyn Law School said he's already seeing early rumblings of a tech recovery, as angel and venture-capital money begins to flow back into the tech startup community.

"We see more and more startups being eyed as acquisition targets," Askin said. "Perhaps the only silver lining in our current unemployment situation is that many innovators and would-be entrepreneurs have seized the moment to work on their own ventures in the absence of having to report to work."

Tell Us What You Think


Bruce de la Vega:
Posted: 2010-12-28 @ 3:22am PT
I notice there's no mention of an eagerness on the part of execs to hire US citizens, yet, so we can expect them to continue hiring less-capable guest-workers.

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