The growing digital economy will capture 17% of global GDP by 2028 and see a 7% compound annual growth rate (CAGR) through 2028, which will in turn drive robust technology spending growth across the globe. In 2025, two-thirds of global tech spending will come from software and IT services, and in Europe and North America, this share of tech spending will be even higher. While the finance and insurance, government, and media and information sectors combined currently account for 46% of global tech spend, other factors driving global tech spending include:

  • Software. Fueled by cybersecurity, cloud computing, generative AI (genAI), and the modernization of legacy systems, software will capture nearly 60% of global tech spend growth through 2029. The forecast shows that software spending by enterprises and governments will reach 1.7% of global GDP by 2029, nearly doubling its worth since 2016. GenAI will revolutionize sectors such as financial services, media, and retail, enhancing customer experiences with more personalized and humanlike virtual assistants and customer service solutions.
  • IT services. Nineteen percent of global tech spend comes from tech consulting and system integration services, and 15% comes from tech outsourcing and hardware maintenance. Driven by infrastructure as a service, outsourcing services growth outpaces that of consulting services.
  • The United States. With the advantages of lower inflation, reduced interest rates, and a dynamic technology sector, the US will see a 6% increase in technology spending (excluding staff costs) in 2025. Remarkably, the US accounted for 41% of global tech spend and 46% of AI software spend in 2024. Almost 70% of the top 24 companies by market cap that saw the fastest growth from 2015 to 2023 come from the US, and more than half of these are media and information companies.
  • The Asia Pacific region. This 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.
  • Managing tech inhibitors. Enterprises need to balance tech talent availability (including AI capabilities acquired through partnerships and acquisitions) with the minimization of technical debt, as well as tangible tech investment returns. Legacy systems still capture two-thirds of global tech spending. 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 (with strong growth expected for data centers) as well as find growth through partnerships and acquisitions. The Forrester report, Global Tech Market Forecast, 2024 To 2029, shows robust 5.6% growth in 2025 to reach $4.9 trillion that is then set to surpass $5 trillion by 2026 and soar beyond $6 trillion by 2029. For more in-depth analysis by region or country, also keep an eye out for Forrester’s European and US tech market forecasts from 2024 to 2029.