Enterprises tightened up the purse strings over the last year, leading to an almost six percent decrease in the amount of IT spending worldwide, said Gartner Inc. in a new report.

That amounts to the largest year-over-year decrease in IT spending that Gartner has ever seen, and although the analyst firm expects things to pick up a bit this year, its $3.54 trillion forecast for IT spend in 2016 represents growth of just 0.6 percent.

So why are companies spending less on IT? Well, Gartner lays the blame squarely at the door of the strong U.S. dollar, which gained so much against other currencies in the last year that the price of exports rose by up to 20 percent in some countries. The number-crunchers also point the finger at economic and political problems in traditionally big-spending nations like Brazil and Russia. Japan too, saw a big slowdown in IT spending over the last year.

As if to prove its point, Gartner says that U.S.-based IT buyers actually bucked the trend, spending $1.14 trillion on hardware and software, a rise of 3.1 percent compared to the year before. Gartner says it expects U.S. IT spending to rise this year too, by around 1.2 percent.

Gartner’s research vice president John-David Lovelock summed up the last year as an “anemic growth period” that’s being hampered by a change in the way customers purchase their IT products and services.

For example, whereas before a company might have purchased a product license for $1 million that’s good for the lifetime of that particular product, nowadays firms tend to purchase Software-as-a-Service products instead, paying for example, $100,000 a year to use it. Hardware sales are also being impacted, with many companies choosing to rent servers in the cloud rather than buy their own.

Across the world, almost every category of IT spending saw a decline, including devices, services and software. The only category to experience growth was data center systems, which was boosted by the rise of cloud services.

Looking ahead, Gartner says that software will see the highest increases in spending this year. It reckons companies worldwide will spend $326 billion on software in 2016, a rise of 5.3 percent. The hottest sub-segment will be customer relationship management software, with more companies looking to integrate social media with their business requirements.

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