Posted on: 5/25/2016

All government contractors should keep an eye on current trends regarding government procurement and what verticals the majority of the contracts are being awarded in. The government procures billions of dollars each year for services in a wide variety of industries, from medical and construction to IT and aerospace. National security and military programs have dominated the federal contracting realm for many years, but now information technology (IT), and even more specifically health IT, is seeing an increase in contracts.

In 2015, the government spent $6 billion on health IT contracts, which represents a 25% increase from 2012 (Bloomberg). Despite such a dramatic increase in spending, military defense continues to see a majority of the government’s dollars ($284 billion in FY2014). Energy was the next largest at $25 billion and Health and Human services at $20 billion. The study, compiled by Bloomberg Government and NCMA (National Contract Management Association), also says that nearly ? of the contracts are tied to IT and facilities management.

Even though the majority of money goes to defense, reports show that health IT is slowly rising while defense is declining. This pattern is predicted to continue in the coming years. So contractors should take note that the focus is slowly shifting to IT.
Since the government recently implemented the "Defense Federal Acquisition Regulations Safeguarding Rule," requiring contractors to have specific security controls on the government information in their possession, cyber security is another industry on the rise. This means every contractor should be keeping their own IT and cyber security up to date in order to win government contracts.

Complementing the IT theme in contracting, government agencies are currently moving to the
cloud. The cloud-computing trend is opening up a lot of opportunities for IT contractors as agencies update their software and move into the future of the cloud. These trends reveal what the top sectors in government contracting world are doing in 2016 (and most likely 2017 as well). What is your contracting company doing to keep up to date with big moves in technology for the government and its contractors?