Sequestration and government shutdown in 2013 were costly for government contractors, according to a new survey.

Nearly a third (31%) of the contractors polled said their revenues had dropped by at least 10% as a result of sequestration and shutdown, according to the survey by Market Connections Inc. and Lohfeld Consulting Group Inc.. They recently conducted the online poll of 220 government contractors.

Another 30% said revenues had fallen more moderately, by as much as 10%, as a result of the shutdown and sequestration.

In addition, 16% said revenues were basically flat, while 15% saw moderate to significant revenue growth. The remaining 8% declined to comment about revenue.

Small government vendors fared worse, with 42% of small businesses reporting a significant decline in revenue in 2013 vs. 21% of large businesses, the pollsters told Set-Aside Alert.

To cope with the increased pressures, 48% of the contractors said they are expanding into state and local governments vs. 29% a year before. They also are pursuing new federal agencies, global markets and new lines of business such as energy, and 35% are modifying lines of business and improving capture strategies.