The uncertain economy is not holding back executives at technology companies from predicting growth in 1999, according to a report released yesterday by PricewaterhouseCoopers.
According to the company's quarterly "Technology Barometer" survey of 376 executives at fast-growing technology product and service companies, business leaders are predicting overall economy growth of only 2.7% for 1999, and only 52% of the respondents said they are optimistic about the economy. Yet within the technology industry niche, the respondents are expecting growth rates of 11.5%. When it comes to their own businesses, the respondents are even more confident, anticipating gains of 25.2%. The predictions succeed an expected revenue growth for 1998 of 21.3% over 1997, a slightly lower result than the executives had expected earlier this year.
Taking advantage of the prospective growth, 50% of the executives will be making major investments next year, pouring 10.7% of composite revenues into business growth--and 67% of that will go into IT investments.
"Although there's a rosy picture here, these firms are casting a wary eye," said Pete Collins, director of the PricewaterhouseCoopers survey. According to Collins, respondents admitted increased concerns about maintaining market demand and profitability than in past years. And while they are making business growth investments, they're not increasing the investment amounts significantly over last year.
Also of concern is the shortage of qualified workers, Collins added. "The pool of qualified workers is becoming exhausted, but companies are being cautious and not looking to hire a lot more people, so the focus is going to be more on productivity and getting the most out of the people they have."