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A decline in business activity for the telecoms and computing sectors that has deepened since January should come to a gradual halt over the next three months. The Confederation of British Industry said that, while the sectors have so far receded like all professional services, their sharpest falls in business activity appear to be over. Over the next quarter, the drop in business values for the ICT sector is expected to cease, while its business volumes, also still in decline, are expected to stabilise. Rather than being based on optimism, the forecast from the CBI’s fresh reading of ICT firms was due to less pessimism, particularly compared with three months ago. In other words, business for technology-led service providers “is not expected to decline at the same rate going forward as it has in the past six months,” the CBI said. Partly, this is because more computing/telecoms firms reported higher profitability, with 41 per cent giving a positive response, against 2 per cent in the previous quarter. The proportion of professional service firms cutting back on IT spending has also eased more than that planning to scale back purchases of buildings and machinery. And the number citing ‘e-business’ activity as the cause of new investment in the next 12 months is at its highest level since May last year, before the recession began. Yet some of feeling that telecoms/IT services firms are ready to re-invest may stem from job cuts, as the number of staff on the sectors’ payroll has fallen since three months ago. May 28, 2009 Email this article Printer friendly page Previous Page
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