Technology cost cutting is still happening in 2026, but the dominant method has changed. ETR's Spring 2026 Macro Views Survey, a quarterly read on enterprise technology budget intentions, finds that reducing staffing costs was named as the primary IT cost-cutting method by 20% of respondents, its lowest level across the past five quarterly surveys. In the same data, SaaS licensing optimization reached 9%, its highest recorded level. The efficiency imperative has not gone away. The methods are simply getting more precise.
The survey draws on responses from over 1,700 technology leaders.
Staffing cost reduction was named as the primary cost-cutting method by 20% of respondents, its lowest reading in five quarterly surveys, down from 25% in October 2025 and January 2026.
SaaS licensing optimization reached 9%, its highest recorded level, up from 7% in January 2026.
Vendor consolidation is now the second most-cited cost-cutting method at 16%.
Enterprises added new capabilities from existing vendors (12%) at more than twice the rate of adopting new vendors (6%).
The shift reflects a more surgical efficiency playbook, targeting overlap and underutilization rather than headcount alone.
Enterprise technology spending is still growing in 2026, but the market has entered a more demanding phase. Buyers are still investing, but with less patience for waste, overlap, and unproven value. And that shift in posture is showing up in how they cut, not just how they spend.
Two years ago, the fastest way to show the board an IT cost reduction was to cut headcount. It was visible, immediate, and showed up on a spreadsheet within a quarter. The Spring 2026 data suggests that playbook is losing favor. Headcount reduction is giving ground to vendor consolidation, SaaS license audits, and project rationalization. Efficiency programs are becoming more operational and less blunt-force.
The question facing CIOs and procurement leaders has shifted. It is no longer only, "Should we buy this?" It is also, "Should we keep this?"
Headcount reduction remains in use, but it is no longer the default. The share of respondents naming staffing cost reduction as their primary cost-cutting method fell to 20% in Spring 2026, its lowest level across the five most recent quarterly surveys and down five percentage points from the 25% that held in both October 2025 and January 2026.
That does not mean organizations have stopped managing headcount. It means headcount reduction is no longer the first answer when the CFO asks for a leaner IT budget. Other methods have gained enough share to dilute staffing's position in the response.
The shift reflects a more mature view of where IT costs actually sit. Headcount reductions remove payroll expense. They do not automatically reduce the software, infrastructure, and services spend those employees were supporting. In a market where cloud commitments, SaaS contract stacks, and multi-year licenses carry their own momentum, trimming the team can actually increase the cost-per-user ratio on the technology that remains.
CIOs who built their cost-reduction case on headcount alone are now confronting a second wave of scrutiny, one aimed directly at the vendor stack, the full set of technology products and services in use.
Vendor consolidation (16%), project delays (15%), and SaaS licensing optimization (9%) were each named as a primary cost-cutting method by a growing share of respondents in ETR's Spring 2026 Macro Views Survey. Each targets redundancy and underutilization rather than removing people.
How SaaS licensing optimization works in practice. SaaS licensing optimization is the process of auditing, renegotiating, and shedding unused or underutilized software licenses to reduce recurring costs. In practice, it typically moves through three stages. The first is visibility: building a current inventory of every license in the organization, what it costs, who is using it, and when it renews. Many organizations discover in this stage that a meaningful share of their SaaS spend is on licenses provisioned for teams or use cases that no longer exist. The second stage is right-sizing: aligning seat counts (the number of licensed users) and service tiers to actual usage. The third is renegotiation: returning to vendors with usage data to reduce spend, consolidate tiers, or renegotiate renewal terms from a position of evidence rather than assumption. Each stage requires cross-functional coordination between IT, procurement, and finance, which is part of why SaaS optimization was slow to scale. Organizations are now building that muscle.
Vendor consolidation operates at a different level. Where SaaS optimization targets the licenses within a vendor relationship, consolidation means reducing the total number of vendors in use, typically by migrating to a platform that covers multiple use cases. Both address software cost, but consolidation works at the portfolio level while optimization works at the contract level. Both hit a vendor's revenue line.
Where headcount reduction addresses the cost of labor, these methods address the cost of overlap, and can yield meaningful budget recovery without the operational disruption, retention risk, or institutional knowledge loss that accompany staff reductions.
The answer follows the spending data directly. Software categories with the weakest growth expectations are the ones under the most optimization pressure, and the Spring 2026 Macro Views data shows a clear gradient.
HR and workforce management software (HCM) posted the weakest growth of any software subcategory at 2.3%, well below the software category average. HCM is inherently seat-count-driven: as headcount caution increases and hiring slows, organizations find they are paying for capacity they are not filling. Licenses tied to workforce size become natural targets for right-sizing.
Security software sits at the opposite end at 7.2% growth, leading all software subcategories by a wide margin. Monitoring, data, and business intelligence (BI) tools followed at 5.7%, reflecting continued investment in the data infrastructure that supports AI initiatives. These categories are, by contrast, the least likely to face license audits. Their growth rates signal that enterprise buyers view them as essential rather than discretionary.
The practical implication for CIOs and procurement leaders is a rough triage framework. Software that is growing fast in the spending data is software the market is actively prioritizing. Software that is growing slowly, or that is directly tied to headcount expansion, is software to examine first in a license audit.
Enterprises are also changing how they expand. A related data point in the Spring 2026 survey shows that adopting new capabilities from existing vendors (12%) outpaced adopting entirely new vendors (6%) by more than two to one.
That ratio reflects a deliberate posture. In a tighter budget environment, buyers appear more willing to expand with providers already in place than to introduce new vendors that require additional procurement, onboarding, and risk review. Expanding the vendor count adds integration overhead, security surface area, and contract management complexity. Consolidating around fewer platforms, even at a modest feature tradeoff, often reduces total cost of ownership more reliably than chasing best-in-class point solutions.
For vendors, this dynamic creates a different kind of pressure. In a high-growth environment, buyers may tolerate overlapping tools. In a more disciplined environment, every product has to defend its place in the stack. The opportunity for growth is still there, but the path runs more reliably through trusted relationships, measurable value, and clear business justification than through net-new logos alone.
Three operational priorities follow from the data.
First, license visibility is foundational. SaaS optimization is not possible without a current, accurate view of what has been purchased, what is actively being used, and what the renewal timeline looks like. Many organizations lack this level of granularity that optimization requires. Building that visibility is the prerequisite, not the output.
Second, vendor consolidation conversations work better when they start early. Vendors are more willing to offer favorable pricing and bundling terms at renewal or expansion than mid-contract. Procurement teams that model consolidation scenarios six to twelve months ahead of key renewals have considerably more leverage than those reacting to budget pressure in real time.
Third, the cost case for project rationalization deserves more rigor than it typically receives. Delaying or stopping new projects is the third most-cited cost-cutting method, but stopping a project that has already consumed budget and created dependencies carries its own costs. Evaluating project portfolios against current business priorities, rather than inherited roadmaps, is what separates organizations that find real savings from those that defer costs rather than eliminate them.
The Spring 2026 Macro Views Survey shows that IT cost reduction is not going away. The methods are becoming more sophisticated. Staffing reduction remains part of the toolkit, but vendor consolidation, SaaS license optimization, and project rationalization are gaining share because they address what actually drives waste in mature technology environments: overlap, underutilization, and inertia.
For CIOs and procurement leaders, the practical implication is that the hardest part of the current efficiency cycle is not identifying that cost reduction is needed. It is building the internal capability to find and execute it at the line-item level.
The Spring 2026 Macro Views findings go deeper than tariffs. The full report covers spending intentions across cloud, software, hardware, and AI, with breakdowns by sector, company size, and region. Visit the Macro Views page to fill out the form to access the summary and complete report.