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Gov't IT Spending to Reach $64.9B

RESTON, Va. -- According to a recent report from INPUT, the authority on government business, budget deficits will suppress state and local IT spending in 2009, and budgets will remain tight throughout the forecast period. However, demographic pressures will force states and localities to seek new administrative efficiencies in order to redirect money toward priorities areas. Professional services and outsourcing will account for 48.4% of the market's $16.5 billion in growth as state and local governments seek to automate manual processes, augment staffing, and take advantage of private-sector competencies.

State and local governments provide services that touch citizens on a daily basis,” said Chris Dixon, manager of state and local industry analysis at INPUT. “They can delay and stretch their spending cycles, but they cannot put off spending for more than a few years. Tight budgets will mean less tolerance for speculative IT investments with savings that cannot be captured and reallocated toward bread-and-butter services in education, public safety, infrastructure, and health care.”