ICT sector: majority of sales expected to rise in the first quarter

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The majority of managing directors of German information and telecommunications companies expect an increase in turnover in the first quarter of this year. This is according to the industry report from the Leibniz Center for European Economic Research. Compared to the assessment of the previous quarter, however, the forecasts are less positive. There is disagreement in the ICT sector about expected staffing requirements.

ICT bosses less optimistic despite expected sales growth

Just under 38% of ICT CEOs expect turnover to increase in the first quarter of 2025. At 37%, almost as many of them expect the figures to remain the same. A quarter expect sales to fall within this period. Hardware manufacturers are less optimistic about the current economy than ICT service providers. Just under a third of business managers in the hardware sector expect turnover to fall, while around 35% expect the figures to remain constant. In a global comparison, low sales growth is expected in the ITC sector in Germany.

Compared to the assessment of the fourth quarter of 2024, expectations are cautious. Almost 44% of ICT company bosses stated that they had recently achieved rising turnover. 29% reported constant turnover and 28% reported falling turnover. While the figures for ICT service providers are almost identical to those for the sector as a whole, a different picture emerges in hardware production. Here, just under 36% of companies recorded falling sales, while 22% reported largely unchanged figures.

Hardware industry anticipates fewer staff requirements

Currently, more than a quarter of managing directors in the ITC sector expect staffing requirements to increase, while only around one in ten anticipate a reduction in their own company's workforce. Over 60 percent of company managers expect the number of employees to remain constant. In the hardware sector, however, the trend is different. Only one in five managers expect to increase staffing levels, while more than a third of them anticipate job cuts.

Contrary to the last quarter of 2024, ICT bosses expect the situation to be more relaxed. Most recently, 31% of companies hired additional employees, while less than a quarter of them cut jobs. Around 45% recorded no changes in employee numbers. In the same period, only 18 percent of hardware manufacturers advertised new jobs. At the same time, almost 40 percent of them recognized a decreasing need for personnel.

Managing directors predominantly expect rising demand

For the current quarter, around 37% of ICT managing directors expect demand for their products and services to increase. Just under 42% expect the figures to remain the same and 22% expect them to fall. Heads of hardware manufacturers assess their market somewhat differently. Almost 40% of them expect product demand to increase, while just under a third anticipate falling figures and almost 29% expect no change.

Compared to the previous quarter, current expectations are less optimistic. Most recently, more than 40% reported an increase in demand. Around a third of ICT company managers rated the figures as constant and around a quarter as declining. The hardware industry already diverged from the trend in the ICT sector as a whole last quarter. Almost 47% of managing directors recognized an increase in demand, more than a third of decline. Only around 17 percent referred to constant figures.

For the study, the authors surveyed the managing directors of around 1200 companies from the manufacturing industry and the information science sector, which is made up of the information and telecommunications sector, as well as media and knowledge-intensive service providers. Most recently, another study by the Leibniz Center revealed that new start-ups in the ICT sector have fallen to a new low.

(sfe)