How Will IT Be Affected by Tariffs?

TThe Impact of Tariffs on IT Budgets

The potential for new U.S. tariffs on imported goods, including technology and manufacturing components, could put additional financial strain on businesses. With many organizations already operating on tight budgets, these added expenses could significantly impact IT procurement strategies.

A 2023 report from Gartner suggests that IT spending in North America was projected to grow by 5.5% annually, but with tariffs increasing costs, companies may need to reconsider budget allocations (Gartner, 2023). The higher cost of hardware, software, and critical IT infrastructure could mean IT teams struggle to secure funding for upgrades, replacements, and new initiatives as organizations shift spending priorities to manage these added financial burdens.

How Will IT Be Affected by Tariffs?

Businesses affected by tariffs may prioritize cost-cutting measures over strategic IT investments. This could lead to:

• Delayed or reduced hardware refresh cycles – Companies may extend the life of aging IT assets rather than replacing them, increasing the risk of failures and security vulnerabilities.
• Reduced innovation – IT teams may struggle to get executive buy-in for new technology initiatives, hindering modernization efforts.

Strategies for Maximizing IT Budgets

Organizations facing budget constraints due to tariffs need to optimize their IT spending. A strategic approach to IT Asset Management (ITAM) and IT Asset Disposition (ITAD) can help companies extend the value of their existing assets and recover costs from retired equipment.

Key strategies include:

• Recovering value from old IT assets – Businesses can generate additional funds by securely remarketing and reselling their outdated IT assets instead of simply disposing of them.
• Reducing disposal costs – Proper ITAD practices ensure responsible recycling and compliance while minimizing waste expenses.
• Optimizing asset utilization – A well-managed ITAM program helps businesses track, repurpose, and extend the life of IT assets efficiently.
• Exploring alternative procurement models – Options such as leasing hardware, utilizing refurbished equipment, or moving to cloud-based infrastructure can reduce capital expenditures while maintaining operational effectiveness.

Conclusion

How will IT be affected by tariffs? As tariffs drive up costs, IT teams will need to be more strategic in securing and allocating their budgets. With IT hardware and infrastructure costs rising, organizations must explore alternative ways to stretch their budgets while maintaining security, compliance, and operational efficiency. By optimizing IT asset management, extending hardware lifecycles, and considering new procurement strategies, businesses can remain competitive in an uncertain economic climate. Strategic decision-making will be key to ensuring that IT departments can continue supporting business operations despite financial pressures.