The service sector is at a standstill...but digitalization has only just begun...

Lena Hagman writes in Almega's latest Services Indicator that the service sector has reached a crossroads. It also includes the IT and telecom sector, where it is clear that economic activity in the sector turned around during the fall and companies now expect reduced demand for 2013.

The IT sector is always late in the economic cycle and has the great advantage that customers are in all sectors, we supply industry, trade, public sector, banking / finance, ... This is a great strength for us as an industry. The public sector is still making procurements while industry is running at low speed. Efficiency improvements are always on the agenda in recessions, and this also benefits our industry. All in all, this means that the IT and telecom sector is resisting the economic cycles reasonably well, which can also be seen in the figures from the National Institute of Economic Research. There we also see that the industry is optimistic - there are still more people who believe in increased demand than decreased. And that is good.

Our big concern is the price level. If you look at Statistics Sweden's Service Price Index, you can see that "computer consultants" are basically the only industry with a negative price trend over the past five years. And many of us can testify that consultancy prices are basically at the same level as in the 90s. This is not due to the economic situation or lack of demand, but is a structural problem caused by global competition. The streamlining of the industry to maintain profitability has been good and should make us well equipped to compete globally.

So I am not worried about the future of the industry. We are fortunate to work in an industry with extremely rapid technological development and many new sectors that will benefit from our services and products in the future. Digitalization has only just begun...