Deltek forecasts that state and local government agencies will increase spending on information technology products and services by more than 3 percent annually over the next five years, the Washington Post reported Sunday.
Chris Dixon, a senior manager at the Herndon-based market analysis firm, estimates IT investments at the state and local levels to grow from $60.4 billion in 2014 to $70 billion by 2019.
He says a Deltek analysis of state budgets has found an almost 5 percent hike in IT spending over the past year.
“Healthcare is the primary growth category for IT investments as states, many of them leveraging federal funding incentives, look to modernize Medicaid systems in order to reduce fraud and improve outcomes for beneficiaries,” Dixon stated.
He predicts data center modernization, cloud storage and mobile communications will also drive technology consumption at the state level.
The public higher education IT market is projected to remain steady in the coming years and offer opportunities for companies that develop operational, instructional and research technologies, according to Dixon.