IT services spending across industry verticals is set to rise 6.2%, with hardware also growing by 4.6% in 2007, in a sign IT purse strings are loosening.

Retail and manufacturing will lead this investment increase, the Western European vertical markets IT spending report published this week has found.

Retailers will spend 5.4% more compared to 2006, while manufacturing – which made up the largest total spend of all 22 industry verticals surveyed in 2006 at 22% – will sustain a growth rate of 3.6% to 2010.

Across all sectors, the average increase in investment to 2010 will be 4.3%. And, although IT services and hardware will gain most traction during this time, software will enjoy the fastest rate of growth at 6.6% from 200 to 2007.

In total, IDC predicts £191 billion will be spent across industry verticals during this year.