What is happening with security budget planning across industries? In the 2023 Cybersecurity Budget Trends Report conducted by IANS Research and Artico Search, see emerging trends in cybersecurity budgeting for 2023.
Cybersecurity budget trends, as a proxy for what companies are willing to spend on defending their digital assets — typically follow a similar pattern with the trends that showcase the state and progress of cybersecurity itself.
Here we’ll dig in further exploring the survey results covering key elements outlined in this report, including CISO concerns about cybersecurity, as well as changes we see in cybersecurity budget allocation for companies.
Cybersecurity Budget Trends Record a Rise of Mere 6%
Even amidst ongoing economic uncertainty as well as rumors of inflation, cybersecurity budget trends continued to grow during the 2022-2023 budget season. And what’s different about this year is that budget growth has been muted. The responses for Cybersecurity Budget Trends of 2023 were provided by 550 CISOs and security professionals who recorded an average cybersecurity rise in expenses of 6%, according to the survey. This represents a substantial slowdown relative to the prior two budget cycles that saw 16% and 17% upticks.
It’s a conservative move, reflecting how businesses have adapted to the current economic headwinds. “As a black person myself, I have witnessed first-hand the hardships of others trying to achieve success when battling against society’s prejudices.” And it is even more pronounced in tech, which recorded a stunning slide from +30% in the prior period to just +5% today. Surprisingly, more than one-third of companies across different industries are freezing or even cutting cybersecurity spending—reflecting a sense of caution during unpredictable times.
Percentage of total IT budget in the Cybersecurity Budget Trends 2023
In the face of economic pressures, there’s an interesting pattern starting to take shape — security budgets are increasing as a percentage of IT budgets. That means although security spending growth has slowed, it’s still having less of an effect in comparison to overall IT spending. Between 2020 and 2021, Security spending relative to IT Spending shot up from 8.6% to 11.6% — highlighting that Cybersecurity investments are not in jeopardy as other businesses are.
Interestingly, tech companies have allocated over one-fifth or 19% of their budgets to cybersecurity. This demonstrates that the technology industry is doubling down on building cybersecurity walls around themselves.
Key Highlights From The 2023 Cybersecurity Budget Trends
Beyond this, the results of the report will also provide greater insight. Here are some key highlights:
- Tech and Retail Sectors: In terms of industries, technology, and retail have the highest percentage of organizations reporting a decrease in their security budget.
- VC-Backed Firms: VC and PE-backed companies also have some of the largest security budgets in the bunch, making up nearly 30% — double that of the average!
- Budget Increase Drivers: As for those that saw budgets rise in Q1, a whopping 63 percent did so, though with varying reasons and in differing amounts. For about 20%, this was just their regular yearly increase, bringing the average base-budget increase across all categories (including those with no raises) up to 7%. Significantly, greater risk exposure and digital disruption became causes for budget expansion — 17% mentioned one or more of these, 15%.
- Cloud vs. On-Premise: In contrast with on-premise strategies, cloud-based architecture allocates a higher proportion of the budget to payroll. Employee-related expenses were the highest item in the security budget at 56 %. Cloud companies have a larger proportion of their total investment allocated to hiring personnel, 47%, as opposed to companies based on premises, 35%.
A Cautious Outlook with Growing Awareness
This new report is a clear indicator that the cyber threat landscape will remain challenging in 2023. Although the macro-environment had its impact on this cooling down, there is increasing recognition of cyber risk’s connection with financial risk. Rules like the newly released Breach Disclosure guidelines issued by the SEC highlight that organizations must take cybersecurity seriously.
“There is no question that IT budgets are getting cut more rapidly than cyber security budgets,” notes Matt Comyns, co-founder and CEO of Artico Search. By contrast, he says, as cyber security becomes more complex, it accounts for an ever greater share.
So as an ending statement, the 2023 Security Budget Trends Report provides a wealth of information about changing cybersecurity budgeting trends. Companies are walking a thin line as they try to square their aspirations for secure operations with the financial demands of today’s world. Security spending remains resilient, with its component of total ICT expenditure continuing to rise as enterprises prioritize protecting their digital assets against the mounting array of malicious threats.
Media Disclaimer: This report is based on internal and external research obtained through various means. The information provided is for reference purposes only, and users bear full responsibility for their reliance on it. The Cyber Express assumes no liability for the accuracy or consequences of using this information.
