EY survey reveals upcoming US presidential election will have notable impact on technology sector

Press Releases

Oct 16, 2024

Three in four business leaders in the technology industry (74%) think the results of the upcoming US election will have a major impact on the US tech sector’s ability to stay ahead of global competitors

NEW YORK, Oct. 16, 2024 /PRNewswire/ — Ernst & Young LLP (EY US) today released its latest technology pulse poll, which examines how technology leaders think the upcoming US election will impact the technology industry. The poll of 500 technology industry leaders, which was conducted in October 2024, reveals that respondents expect the outcome of the US election to impact artificial intelligence (AI) regulation, initial public offering (IPO) activity, innovation and global competitiveness.

Tech industry leaders said they plan to significantly increase AI investments in the next 12 months, although they indicate that future progress toward AI growth may be contingent on the outcome of the elections. Specific focus areas of AI investment include hiring AI-specific talent, back-office functions and cybersecurity. As companies look to further develop AI initiatives, there will be a growing need to hire AI-specific talent, while also restructuring and/or reducing legacy job functions in exchange for other in-demand functions.

Nearly three-fourths (74%) of technology industry leaders think the results of the upcoming US election will have a major impact on the US tech sector’s ability to stay ahead of global competition in the next two to four years. Notably, they think that the outcome of the US election would most impact the following areas of regulation: cybersecurity/data protections, AI and machine learning, and user data and content oversight.

“Regardless of the presidential outcome, technology companies will continue significant investment in AI. However, all eyes will be on how election results impact the direction of fiscal, tax, tariff, anti-trust and regulatory policies and the resulting impact on interest rates, mergers and acquisitions, IPOs, and AI regulations. Coming off of a sluggish tech market in 2024, the 2025 trajectory is bullish, as companies focus on raising capital to invest in growth and emerging technologies like AI,” says James Brundage, EY Global and Americas Technology Sector Leader.

Other key findings from the EY survey include:

Tech leaders double down on AI
The majority of technology leaders (87%) say their company plans to increase AI investments by 50% or more in the next year. The key areas where these leaders report plans to focus AI investment over the next year include AI-specific talent (60%), cybersecurity (49%) and back-office functions (45%). Most tech industry leaders surveyed also say they plan to allocate/reallocate resources toward AI investments in the next 6–12 months, with 78% of tech leaders reporting their company is thinking about divesting noncore assets or businesses as part of their growth strategy during that time.
Size hinders AI speed
Tech leaders say around 63% of their organization’s AI initiatives have successfully moved to the implementation phase. However, organizations that employ more employees report less success moving AI initiatives to the implementation phase. Among those who indicate that fewer than half of their AI initiatives have been implemented successfully, data quality issues (40%) and talent/skills shortages (34%) are the most common reasons for AI initiatives failing to progress to the next stage.
The search for AI talent accelerates
As companies continue to integrate more AI into their businesses, the need to hire AI-specific talent will increase, as well as the need to restructure or reduce headcount from legacy job functions. In fact, 80% of tech leaders surveyed said they foresee reducing or restructuring headcount from legacy functions to other in-demand functions, and 77% anticipate an increase in hiring for AI-specific talent. Additionally, 40% of technology leaders say their company plans to focus next year’s AI investments on human capital efforts such as training.

“As companies pivot to more investments in AI talent, there are key considerations for tech leaders as they strive to bridge the gap between AI investment and implementation,” says Ken Englund, EY Americas Technology Sector Growth Leader. “These include hiring talent with both hard and soft skills, offering AI training programs, and upskilling their workforce.”

Survey methodology
EY US commissioned Atomik Research to conduct an online survey of 503 US business leaders working within the technology industry. Participants held roles similar or equivalent to director, vice president, senior vice president, executive vice president, C-suite or president. Business leaders surveyed worked at organizations consisting of 5,000 or more employees. The margin of error is +/- 4 percentage points with a confidence level of 95%. Fieldwork took place between September 27 and October 7, 2024.

About EY
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Working across assurance, consulting, law, strategy, tax and transactions, EY teams ask better questions to find new answers for the complex issues facing our world today.

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Contact:
Sara Nazarian
Sara.Nazarian@ey.com