Analysis: Companies have cut IT services budgets by around 20 pct in last two years

 The budgets allocated for IT services are about 20% below the level recorded two years ago, and Romanian programmers have begun to accept lower salaries amid the decline in the number of projects and increased competition, shows a specialized analysis published on Monday.According to Romanian software developer Oves Enterprise, this downward trend in IT project budgets is in line with what is happening internationally, where companies, including those in the technology sector, are cutting expenses and looking for more cost-effective solutions."The decline in IT budgets has been driven largely by global economic uncertainty, inflation and the need for companies to prioritize essential investments. Many large companies initially turned to outsourcing to India, attracted by lower costs. However, in the recent period, most of them have returned to Eastern European suppliers, including Romania, due to quality and delivery inconsistencies encountered in Asia," the experts point out.However, despite this recovery trend, budgets remain lower than before the crisis, still around 10% to 15% higher than those offered for services in India, but significantly lower than in 2022.In Romania, current trends in the IT industry reflect these changes. Thus, experts note that in addition to shrinking budgets, IT companies are being forced to innovate to remain competitive."The use of artificial intelligence (AI) and process automation (RPA) technologies have become essential solutions for optimizing costs and increasing productivity. And Romanian programmers, who previously had high salary expectations, have begun to accept lower salaries as the number of projects has decreased and competition has increased," notes the source.Internationally, reports show that IT budgets have shrunk by about 20% in the past two years, while outsourcing to regions with cheaper labor, such as India and the Philippines, initially increased but has faced quality problems.Deloitte research shows that 63% of companies cited cost savings as the main benefit of outsourcing. At the same time, AI integration and process automation have become critical factors in increasing operational efficiency and market competitiveness.Oves Enterprise is a Romanian software development company, with expertise in creating complex software solutions and AI innovations for the aerospace, defense and cybersecurity industries, established in 2015 in Cluj-Napoca.