Read our full analysis for a more in-depth look at these trends.
Technology services still computing for small firms
Spending on tech services was strong in Q1, though small manufacturing and retail firms lagged due to tariff-related challenges.
May 2025
Key takeaways
- Equipment and software investment has steadily increased since 2008, and reached more than $1.3 trillion at the end of 2024. However, heightened economic uncertainty threatens continued investment as more firms pause capex purchases.
- Yet, for many firms, technology-based investment can promote productivity and enhance efficiency. According to a Bank of America proprietary survey, more than 90% of small and mid-sized businesses plan to invest in digital tools. Plus, small business payments to technology services firms grew 11.1% year-over-year (YoY) in March, according to Bank of America internal data.
- Manufacturing and retail showed weaker technology services payment growth than construction and services. It's possible this is being driven by tariff-related challenges for firms exposed to more discretionary spending in end-markets such as consumer goods or auto manufacturers, according to BofA Global Research.
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