Global Tech Spend To Surpass $4.9 Trillion In 2025

Forrester Research, a leading global research and advisory firm, has projected that global technology spending will reach $4.9 trillion in 2025, marking a significant acceleration from the $4.7 trillion spent in 2024. This robust growth is driven by several key factors, including the rapid adoption of software, IT services, generative AI (genAI), and cloud technologies. Asia Pacific and North America are expected to see the most rapid growth in tech spending, with Europe also experiencing a notable increase.

According to Forrester's Global Tech Market Forecast, 2024 To 2029, software and IT services combined will account for 66% of global technology spend in 2025. This share is expected to grow even higher in Europe and North America. The finance and insurance, government, and media verticals will account for 46% of global tech spend in 2024, but this share is expected to decrease as software and IT services take a larger share of the market. By 2029, 70% of tech spending will be on software and IT services.

Investments in generative AI are expected to drive industry-specific growth, with financial services, retail, and media sectors increasingly adopting AI-enabled tools to enhance customer experiences and operational efficiency. This growth in genAI investments will force businesses to reposition their workforce, compete for tech talent, and lower technical debt. The United States, with its advantages of lower inflation, reduced interest rates, and a dynamic technology sector, will see a 6% increase in technology spending (excluding staff costs) in 2025. The US accounted for 41% of global tech spend and 46% of AI software spend in 2024, indicating a strong and consistent growth trajectory.

The Asia Pacific region is witnessing a surge in real GDP growth that far exceeds the global average, led by countries such as India, the Philippines, Vietnam, and Indonesia. This rapid economic expansion drives tech spending growth, with emerging countries known for innovation like China, India, Japan, and Malaysia showcasing the region's potent tech investment potential. India will see the fastest growth in tech spend, with an expected increase of 9.6% in 2025. Government initiatives in China and India, and increased investment in generative AI and semiconductors in Japan and South Korea, will help drive tech spend in the region.

Managing tech inhibitors will be crucial for enterprises to balance tech talent availability, minimize technical debt, and achieve tangible tech investment returns. Legacy systems still capture two-thirds of global tech spending, and with the half-life of tech skills at less than five years, skills renewal of the tech workforce is vital. To accelerate technology spending growth in 2025, enterprises will grow their AI infrastructure capacity and find growth through partnerships and acquisitions. The Forrester report, Global Tech Market Forecast, 2024 To 2029, shows robust 5.6% growth in 2025, set to surpass $5 trillion by 2026 and soar beyond $6 trillion by 2029.

In conclusion, the projected $4.9 trillion in global tech spending in 2025 is driven by the rapid adoption of software, IT services, generative AI, and cloud technologies. The United States, Asia Pacific, and Europe are expected to see significant growth in tech spending, with the US leading the way. Investments in generative AI are expected to drive industry-specific growth, and managing tech inhibitors will be crucial for enterprises to achieve sustainable growth. The Forrester report highlights the robust growth trajectory of the global tech market, with projections set to surpass $5 trillion by 2026 and $6 trillion by 2029.