Cybersecurity Budgets Coming Under Pressure in Tough Macro Climate

Although cybersecurity is increasingly a top priority for businesses, economic factors such as inflation and fears of a global recession have led to organization-wide belt-tightening at many companies. Many organizations are facing new cybersecurity spending constraints, as described in an article from B2B technology data provider TechTarget, Inc. Legal Operations will need to align with chief information security officers (CISOS) to evolve with the company’s strategy.

TechTarget cites a recent report from IANS Research and recruiting firm Artico Search, stating that over a third of cybersecurity budgets were reported as flat or shrinking in 2023. They did grow an average of six percent, but this was slower than the 17 percent growth in 2022. A PwC survey infers that the outlook for 2024 is similar and predicts that 79 percent of organizations will increase their cybersecurity budgets. However, only one in 10 will do so by at least 15 percent.

These are the major drivers of cybersecurity budgets, according to Joseph Harisson, CEO of IT Companies Network:

• More sophisticated cyber threats
• Proliferation of attack surfaces
• Increased regulatory scrutiny
• Recognition of cybersecurity’s importance by the Board

Harman Singh, director at cybersecurity services company Cyphere, said he has observed security leaders under growing pressure to justify their budgets. As a result, he added, many are looking at ways to reduce costs, for example, consolidating automation and security tools.

The PwC survey states that one in five organizations anticipate their 2024 cybersecurity budgets will shrink or stagnate. Gartner estimates that security and risk spending will continue to grow in 2024 by 14 percent.

With the current economic uncertainty, there are expert predictions of both budgetary growth and stagnation.