The Next Two Years in Federal Contracting: Some Uncertainties and Business as Usual

The next two years in federal contracting will be uncertain in the information technology and defense system sectors and business as usual in others. The buildings still need to be maintained, systems still need to operate, and goods are still needed to move to the troops.

The trends in federal contracting for the next two years may include:

1. A decrease in the rate of federal hiring which could, in turn, stimulate federal contracting
2. More spending cuts which could reduce federal contracting
3. Potentially large defense cutbacks which could cause more emphasis on selling to civilian agencies
4. A slow down in the federal initiative encouraging in-sourcing of contract work
5. A shift toward smaller, less risky contracts, particularly in the information technology sector
6. Even more emphasis on multiple-award, indefinite-delivery, indefinite-quantity contracts
7. Continued emphasis on small business participation including the addition of a small women-owned business preference program

A combination of these factors will probably cause some slow down in the market but it will continue to be a robust and lucrative place to do business. The federal government cannot operate without contractors and nothing will change that.

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