Tue Jun 30, 2009 10:04 am
The worst may be over for the U.S. technology sector said Forrester Research, predicting the start of its recovery in the fourth quarter.
The market research company said businesses overreacted to the global recession and credit crisis by cutting back too much on spending in the last nine months.
Companies are now realizing that the downturn is not as deep, or as long-lasting, as they previously feared and will resume technology spending.
Forrester expects the tech market to hit bottom in the third quarter and to begin its recovery in the fourth.
"The good news is that it is in the past," said Andrew Bartels, a Forrester analyst. "We are not going into a terrible terrible downturn."
The research firm said communications equipment spending will drop by 11 percent this year but growth will resume in 2010, with telecom spending expected to grow by about 7 percent.
Computer products spending also declined by 10 percent this year, and is expected to increase by nearly 12 percent next year.
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