There's more to the recovery than socks

There was a memorable moment when, in the early 1990s recession, President George Bush (senior) decided to 'kick start the economy'. His rather staged effort consisted of buying a pair of socks at a major retail outlet.

Clearly, the message was lost amidst the sniggers from various quarters that day but we can seriously ask ourselves now what can kick start the economies of much of the developed world - and invariably help the sectors silicon.com covers.

Two pieces of research reported on today suggest the answer is right under our noses. A major survey - carried out by one of the biggest industry analyst firms on behalf of one of Europe's biggest telcos (see: http://www.silicon.com/a55889 ) - suggests those companies that invest more in IT are more profitable.

Is this profound? For much of the late 1990s (that earlier downturn long in the rear-view mirror), the economic success in the US was put down to levels of investment in IT. The reasoning went that it allowed fast growth while also keeping inflation low, through bringing about efficiencies.

Yet at the first sign of trouble, many projects have been put on hold, or in some cases scrapped.

Second, the UK's Communications Management Association has released similarly in-depth figures (see: http://www.silicon.com/a55890 ) which show, despite all the misery, spending on IT and communications has actually risen over the past year, on average. Does it feel that way where you are?

The answer is seemingly simple yet also difficult. IT must lead the recovery through helping businesses grow again, rather than merely helping cut costs. The tricky part is in convincing those people who are supposed to be in charge of the whole enterprise that buying that hardware, software or service isn't just an outgoing. It should be a real investment and much more important than a token pair of socks.