Canadian companies hit a six year low in technology investments: Report

A recent NOVIPRO Group and Léger report found that Canadian technology investments have hit a six-year low.

The seventh IT Trends report identifies trends and challenges facing small, medium and large Canadian businesses. This survey highlights the profound influence of socio-economic pressures on organizations, including inflation, which influenced 69 per cent of companies to rethink their technology investment decisions.

Just over 75 per cent of survey respondents plan to make technology investments, an 18 per cent decrease compared to 2019. 

“I’m very concerned to see so many organizations once again postponing their technology investments, significantly slowing desired outcomes on their digital journey,” said David Chamandy, chief executive officer (CEO), NOVIPRO Group. “The study reveals that only 38 per cent of companies acknowledge the transformative potential of advanced data analysis and artificial intelligence within the next two years. It appears that they may be underestimating the rapid evolution of this technology and the significant impact it can have on their overall business growth. We firmly believe that those who are swift to invest in these cutting-edge technologies will be the ones best positioned to overcome the challenges posed by inflation and labour shortages.”

Over half of the respondents achieved positive data analytics and AI implementation results. Still, less than 15 per cent will actually invest in these sectors in the next two years — an almost 50 per cent decrease since 2019.

Despite the work-from-home boost in the past few years, security solution upgrades are also declining. Survey answers showed a 15 per cent decrease in employee cybersecurity training between 2019 and 2023.

“Given the speed at which cyber threats are evolving, it is imperative that organizations comply with provincial and federal laws to better protect their customers,” said Alain Cormier, executive director, business development, NOVIPRO Inc. “When you consider that one in four companies fell victim to a cyberattack, and that 57 per cent of them paid the ransom, resulting in costs of over $500,000 in 25 per cent of cases, cybersecurity negligence is much more than a matter of reputation.”

In the IT sector, employers have felt the heat of labour shortages. Some of HR’s biggest challenges include attracting and retaining key resources, and experiencing a loss when employees switch jobs or careers. Nearly half of the respondents (45 per cent) have felt this labour shortage impact company projects.

Another discovery was that just under 60 per cent of companies require employees to use a secure VPN when working remotely. Just over 30 per cent require them to obtain authorization to download applications or software to their work tools.

“The majority of cybersecurity solutions such as VPNs, user authorizations and training are easy to implement, and do not require a significant cost on the part of employers,” said Roger Ouellet, director, security practice, NOVIPRO Inc. “It’s disconcerting to see how these measures are not used more widely, as they can make a tremendous difference in terms of data security.”

Respondents cited the following factors in their decisions to invest less in technology:

  • Inflation (69 per cent)
  • Remote work (68 per cent)
  • Labour shortages (66 per cent)
  • Threat of recession (66 per cent)
  • Environmental disasters (42 per cent)
  • International tensions (41 per cent)

Ontario companies have been hit the hardest by inflation, with Québec companies suffering the least impact. Yet Québec has had a more challenging time recruiting for IT positions, while Ontario has had the most success.

Ontario sits at a 63 per cent increase in successful AI and advanced data implementation, compared to 54 per cent for the rest of Canada.

To access the full report, please visit this link (Registration required).

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Jim Love, Chief Content Officer, IT World Canada

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Breanna Schnurr
Breanna Schnurr
Breanna Schnurr is a recent journalism graduate of Toronto Metropolitan University. She loves writing about all things data, travel, tech, lifestyle and subculture. You can reach out to Breanna via [email protected].

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