Spending on global advertising and marketing will slow this year as brands navigate economic concerns, according to a new forecast. Although spending jumped by 7.9% last year to $1.6 trillion, it is predicted to grow by 5.3% this year, according to market research firm PQ Media. 

The “Global Advertising & Marketing Spending Forecast” report, released annually and now in its 10th edition, cites factors such as inflation, supply chain issues and concerns about recession as causes for slower growth. Spending on digital and “alternative” media—which includes influencer marketing, product placement and ambient advertising such as airplane tray tables—grew globally by 13% to around $746.5 billion last year, while dollars put toward traditional media only increased by 3.6%, to $821.8 billion.

“Some brands cut budgets in the second half of 2022, leading to overall growth tapering into the first quarter of this year. But, while we expect slower full-year expansion in 2023, fears of a broad-based global recession have subsided somewhat,” said PQ Media CEO Patrick Quinn in a statement. “Despite the economic slowdown, many of the top 20 global markets and digital and traditional media platforms had returned to pre-pandemic levels by year-end 2022.”

The U.S. remains the world’s largest media market, but it fell from the third fastest-growing market in 2021 to eighth place last year, according to the report, which named India as the fast-growing market the same year. U.S. ad spend was $622.1 billion last year, an increase of 8.5%, according to the report. 

While traditional ad and marketing spending growth slowed, it still jumped by $1.02 billion in 2022 compared with 2019, before the pandemic began. The U.S. was up $888 million, but traditional spending trailed 2019 levels in 10 of the top 20 markets, including Australia, Canada, France, Germany, Italy, Japan, Netherlands, Russia, Spain and the U.K.

A “key trend resurfacing is the continued shift of brand budgets from ad platforms used to increase brand awareness to marketing platforms that engage end users closer to the point of decision,” said Quinn. This included a growth in market share of content and influencer marketing, according to PQ Media.