The state of the economy affects companies’ spending on consulting services. During the economic recession in the late 2000s, many companies tightened their budgets and held off on information technology upgrades and replacements, thus scaling back on IT consulting services. By the late 2010s, the economy had improved and the need for information technology consultants increased. IBISWorld reported that the U.S. information technology consulting industry performed well during the second half of the 2010s. Annual growth was at 4.2 percent from 2014 to 2019. The industry’s steady growth has benefited from a growing focus on data analytics and cloud computing. During the early 2020s, demand for information technology consultants will benefit from increasing mergers and acquisitions in other industries. As more companies consolidate, information technology consultants will be needed to help with the integration of accounting, information storage, and other technology systems.
According to Gartner, companies scaled back discretionary IT spending in 2019 because of concerns regarding a possible recession. Subsequently, spending was projected to increase just 0.4 percent over 2018 levels, reaching $3.7 trillion. However, the firm anticipated that growth would resume in 2020, with demand for enterprise software boosting overall expenditures by 3.7 percent. Although spending on data center systems, devices, and communication services declined in 2019, the opposite was true for IT services like consulting, which experienced a 3.7 percent increase, reaching $1.0 trillion. Gartner forecast that IT services-related spending would increase 5.5 percent in both 2020 and 2021, reaching nearly $1.2 trillion.
In an October 2019 report, Gartner Research Vice President John-David Lovelock provided insight into the major issues that IT organizations were focused on as the new decade began. These included security and regulatory compliance as the geopolitical environment became more complicated. Lovelock estimated that in the coming five years, cloud security, in particular, would achieve growth of 41.2 percent. "This is not just about keeping the 'bad guys' out," he explained. "It is also about the expanding need to be compliant with tariffs and trade policy, intellectual property rights, and even with the multiple and sometimes overlapping privacy laws."
The coronavirus pandemic caused an economic slowdown in 2020 that is starting to rebound in 2021 due to the rollout of COVID-19 vaccine. Many industries were impacted to varying degrees by the business lockdowns and remote work orders. The IT consulting industry was projected to have about a 4 percent decline in revenue in 2020, based on the reduction of private investment in computers and software. The IT industry has been bolstered somewhat, though, due to the growth in demand for IT support for remote employees. The research group IBISWorld also reported that governmental entities, especially those involved in the response to the public health crisis, need IT consulting services.
As of December 2020, the IT consulting industry in the U.S. was valued at $460 billion, with 462,418 businesses and total employment of more than 2.24 million people. There will be consistent growth in the industry through 2025. Corporate profit is expected to grow, which will, in turn, "fuel a rebound in private investment in computers and software." As for technology trends, IBISWorld forecasts that IT consultants will be needed for services related to cloud-based computing, big-data analysis, and mobile-based solutions. A study by the Pew Research Center also points to opportunities in the information technology industry in post-pandemic times. The growth of remote work, education, medicine, social activities, and more is expected to continue through 2025 and possibly beyond.
Information technology consultants can look forward to good employment opportunities in the coming years. The DOL projects faster than average (9 percent) employment growth for computer systems analysts through 2028. As more companies rely on information technology, computer systems analysts and consultants will be needed to design and install new computer systems. Smaller companies that have few IT needs will find it more cost-effective to outsource to cloud service providers and to organizations with IT service providers. This will offer more opportunities for computer systems design and related services. The health care industry will also need computer systems consultants for help with implementing electronic health records, e-prescribing, and other health care information technology services.
Management consultants will have much faster than average employment growth (14 percent) through 2028, according to the DOL. The demand for management consultants will be especially strong in smaller consulting companies that focus on specific industries or business functions, such as information technology and human resources. Good job opportunities are also expected in the healthcare industry and with government agencies. The competition for jobs will be keen because this is a lucrative field that attracts many jobseekers. Consultants who have an advanced degree and/or certification, specialized industry experience, and fluency in a foreign language will have the best prospects for securing work.
Information technology consultants earned salaries that ranged from $50,000 to $121,000 in January 2020, as reported by PayScale.com. The median salary was $78,760. Computer systems analysts earned a median salary of $68,361 in January 2020. Salaries ranged from $45,000 to $98,000. As PayScale points out, computer systems analysts with skills in Microsoft SQL Server, Java, and .NET earned higher salaries than analysts without these skills.