CSO Survey: Economy Forces Many to Slash, Freeze Security Staff

Spending decreases, personnel reductions in the security department expected by many

Current economic conditions are having a negative impact on the majority of security budgets, according to a survey conducted by CSO. Many respondents indicated hiring freezes or staff reductions were necessary due to the financial crisis (For a different report on security spending see: IT Security Spending Up For Some).

CSO polled security-decision makers in over 100 companies about their spending plans for the coming year to gauge the impact current economic conditions are having on budgets. Of the 159 respondents, 64 percent indicted that the economy was having a negative impact on security spending. Another 19 percent said the economy currently had no impact. Just 6 percent said the crisis was having a positive impact on their organization's security budget (See: 5 Tips for Managing Security in a Recession).

Security budgets will decrease for 35 percent of respondents and remain the same for 42 percent. Just 23 percent thought spending would increase in the coming year. Those numbers are a switch from last year's CSO poll when more respondents expected to increase security spending. In 2008, 38 percent of respondents planned to increase their security budget and just 24 percent expected to see a decrease in spending.

John McReynolds, enterprise security administrator with Crossbeam Systems, a manufacturer of security system software in Boxborough, Mass., said his firm is actually in the minority that plans to spend more on security in the coming 12 months.

"We are increasing from previous years," said McReynolds. "Fundamentally I would have to say the increase is around regulatory issues as well as general responsible security program expansion."

McReynolds said security spending at Crossbeam is often driven by compliance and policy decisions. This falls in line with what other respondents also said, with a majority indicating that policy and compliance are the main justifications for security spending at their organizations as well.

Joe Perchetti, supervisor of security for Radnor Township School District in Wayne, Pennsylvania, comes from a different perspective. Perchetti, who is mainly responsible for facilities security, said he appeals to the school board and the PTO when it comes to asking for security funds. While the stakes are high for campus safety, the dollars are tight.

"Since Columbine, as well as 9/11, we have seen spike in what best practices are to maintain a safe and secure environment for the children, and for others, on our campuses," said Perchetti. "The realization is that I do have a limited amount of budget to spend on these things. But in same sense, you want to update and upgrade to maintain the safety and security awareness that is necessary in this century. It's difficult."

CSO asked security decision-makers if they planned to increase or decrease spending in the following areas: Business Continuity/disaster recovery, data loss prevention, identity management, compliance and regulations, outsourced security systems, physical security, policy and risk management, and staff.

In all but one category, more than half of respondents expected spending to remain at similar levels. However, when it comes to spending on staff, 41 percent expect to see a decrease in spending. Close to 60 percent have either implemented, or plan to implement, a hiring freeze.

"I was brought on board last year and I am not getting any new headcount for my group," said Mc Reynolds, who added that initial plans when he was first hired called for additional support staff in his group. Those plans are now on hold.

Additionally, 35 percent of those surveyed indicated they have had to go beyond a hiring freeze and have actually reduced security staff, or plan to reduce headcount in the next 6 months.

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