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SaaS Inflation Index: 2024
SaaS inflation outstrips consumer inflation once again.
A typical business in 2024 will be spending significantly more on software than it was a year ago — even without purchasing any new products or licenses. While investments in technology can typically lead to more effective employees and market advantages, managing this SaaS inflation requires considered thinking, a close understanding of pricing data and an intelligent approach to software purchasing.
Read our in-depth study on SaaS pricing inflation, with recommendations for how your business can get its ever-increasing SaaS costs under control.
Spend on software has grown 17.9% over the past 12 months alone
In 2023, almost $200bn will have been spent on SaaS globally. That’s more than the GDPs of Algeria, Hungary, and Ukraine. Putting that into more practical terms for finance leaders, that represents approximately $7,900 per employee, up from $6,220 in 2022.
Spend on SaaS per employee is now a bigger contribution than healthcare
This increase is incredibly sharp — up 27% from 2022 — and is a subsequent result of headcount cuts, growth in new software expenditure, and the impacts of SaaS inflation. While most (54%) vendors charge per-employee pricing, often expressed as ‘per seat’ or ‘by license,’ many others use pricing based on features or consumption.