Tech Investment Still Rising, Despite WSJ Story

This morning the WSJ ran a story entitled “Investment Falls Off a Cliff: U.S. Companies Cut Spending Plans Amid Fiscal and Economic Uncertainty.” The story argued that:

Nationwide, business investment in equipment and software—a measure of economic vitality in the corporate sector—stalled in the third quarter for the first time since early 2009.

It’s worth noting, however, that tech investment rose in the third quarter to its highest level on record. The chart below shows real investment in computers, software, and communications gear, in millions of 2005 dollars

The chart is based on BEA data. Please note that there was a pause in tech investment, but it came in the second quarter, not the third.

The way to interpret this chart is that we are in the middle of a data-driven boom. Companies view investment in data and data-related equipment as absolutely essential, and continue to spend, fiscal cliff or no.

Comments

  1. We all know how beneficial and powerful technology is in our daily living not to mention its big role in improving business and process. No wonder the rate of tech investment will continue to rise as far as innovation and development is concern in the future.

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