Small business IT share growing

The small business share of federal IT contracts has grown dramatically in the last five years and now comprises 34% of the total, according to a recent study by Deltek market research firm.

Small business IT procurements totaled 25% of federal IT procurements in fiscal 2010, increasing to 34% in fiscal 2015.

Meanwhile, the share of federal IT contracting dollars going to “other than small” firms fell to 66%, down from 75%, during the same period.

“In the federal IT market, small business contractors have increased their success rate,” according to eCommerce Times, which reported on the Deltek study.

The trend is likely to continue. With total federal IT contracts estimated at $99.8 billion for fiscal 2016, the small business share is likely to be $33.9 billion.

Overall, Deltek predicts that federal IT spending will be on a slight downward trend for the next five years, falling to $98.4 billion by fiscal 2021.

Federal agencies

However, some federal agencies may see a spending bump in fiscal 2017 due to the lifting of sequestration caps.

Here are the agencies expected to see an increase in IT spending in fiscal 2017:

• Treasury Department, a 19% increase, to $4.50 billion;
• State Dept., 15% increase, to $1.63 billion;
• Commerce Dept., 8% increase, to $2.33 billion;
• Social Security Administration, 7% increase, to $1.69 billion;
• U.S. Army, 4% increase, to $9.14 billion; and
• Homeland Security Dept., 4% increase, to $6.19 billion.

Categories of IT

Another bright note is that IT software spending is expected to rise by 10%, from $11.4 billion in fiscal 2016 to $12.5 billion in fiscal 2021.

Other categories of federal IT spending are expected to drop at different rates during the five-year period, including IT hardware, down 4%, to $15.9 billion in fiscal 2021; IT services, down 2%, to $52.6 billion; and IT communications and network down 4%, to $17.5 billion.

Civilian and defense IT

Civilian IT spending is projected to rise by 5% during the five-year period, from $42.4 billion to $44.5 billion. Defense IT contract spending is forecasted to drop from $47.4 billion in fiscal 2016 to $44.4 billion in fiscal 2021, which is a 6% reduction. Intelligence agency IT procurements are anticipated to decrease from $9.7 billion to $9.5 billion during the five-year period, which is a 2% drop.

Contract vehicles

Sole source, single-award procurements made up 44% of IT investments in fiscal 2015. That percentage has dropped from 48% in fiscal 2011, but that form of contracting continues to dominate federal IT.

The other categories of contracts for federal IT spending were agency-specific IDIQ contracts, 26%; GSA Schedule 70, 20%; and governmentwide acquisition vehicles, 11%.

Deltek only released a portion of its research to the public.  Other details were obtained from a report on the Deltek study by eCommerce Times.

More Information:
eCommerce Times: http://goo.gl/4emiIf
Deltek report: https://goo.gl/P3H7s2

Small business IT share growing

HUBZone rules changes posted

JVs: Pop v Unpop

American City & County: "Tom Johnson of Set-Aside Alert outlines the ways that small businesses support their communities"
http://ow.ly/nj1T302RtKb

Column: Financial Management of Contracts for the Project Manager

Washington Insider: