IT vendors are still being cautious when it comes to expressing confidence about economic recovery, according to research.

A study by accountant BDO Stoy Hayward asked technology, media and telecoms (TMT) firms what their prospects were for the next three months, and while 30 per cent said they were “slightly or more confident” about the economy, 32 per cent were “slightly less” or “much less” confident.

In the middle were 38 per cent who said their views have not changed since the previous quarter.

The biggest risk identified by respondents was projects being deferred (42 per cent), followed by falling customer demand (30 per cent).

“TMT firms have undoubtedly felt the impact of the economic downturn and the resulting slowdown in technology spending,” said Julian Frost, head of TMT at BDO Stoy Hayward.

“However, companies in this sector have worked hard to introduce a number of cost-cutting measures to reduce overheads across the full range of business functions. Although confidence levels have declined, the fall has been less severe than might have been expected and companies now appear to be looking to the medium and long-term future with a reasonable degree of optimism."