Across the globe, more organizations are investing in the modernization of information technology (IT) infrastructure and associated service offerings. For many senior executives, the motivation is obvious and compelling.
While most of the IT spending within the commercial enterprise sector is targeted at fueling their digital business growth agenda, the public sector also has its own compelling goals and objectives.
Worldwide government IT spending is now forecast to total $557.3 billion in 2022 -- that's an increase of 6.5 percent from 2021, according to the latest global market study by Gartner.
Government IT Market Development
"Governments will continue to accelerate investments in digital technologies to respond and recover from the continuing evolution of public health uncertainties due to the COVID-19 pandemic," said Irma Fabular, vice president at Gartner.
According to the Gartner assessment, the disruptions caused by the pandemic have also reinforced a key digital government tenet, which is public policy and technology are now inseparable.
In 2022, increased investments in digital technologies will see governments spend 64 percent of total IT spending on IT services and software to improve the responsiveness and resilience of public services.
These growth forecasts include IT investment in enhancing customer and employee experience, strengthening analytical capabilities, and scaling operational agility.
IT infrastructure and applications modernization, as well as digital government transformation, will remain high government priorities during 2022.
In addition, COVID-19 economic assistance funding packages, such as the American Rescue Plan Act in March 2021 and NextGenEU, will drive further funding on digital enablement, including support for sustainable growth, social programs, education, cybersecurity, and digital inclusion.
Gartner analysts believe that the pandemic has amplified the need for governments to rapidly scale IT infrastructure and application systems and respond to unprecedented citizen demands.
Gartner estimates that by 2025, over 50 percent of government agencies will have modernized critical core legacy applications to improve resilience and agility.
"Governments are rethinking their public cloud strategies to accelerate IT modernization, improve efficiencies and increase data security," said Fabular.
Government IT Growth for Education and Healthcare
The COVID-19 crisis has further intensified the need for adopting citizen digital identity as a critical element to digital government transformation. Digital identity is moving beyond authenticating citizens online and signing remote transactions.
Gartner believes that in order to raise the chances for greater adoption of digital identity, governments must treat privacy, security, and user convenience as critical success factors.
That said, I anticipate U.S. Federal government funding assistance for State and Local government projects will likely fuel incremental IT investment for public education applications, as more institutions embrace hybrid learning models.
Furthermore, I believe that public sector healthcare agencies will increase IT investment in Telehealth services delivery models, as more medical practitioners acknowledge ongoing demands for virtual consultations that are driven by COVID-19 pandemic-related disruptions.