Federal contracting shrunk by $58 billion in fiscal 2013, or 11 percent from the previous year, according to a New York Times analysis published Thursday.
The change marked the largest decline in a decade, the NYT analysis said, and left companies across the country scrambling to diversify their capabilities. Joe Jordan, the Obama administration’s soon-to-depart administrator of federal procurement policy, told the Times that some of the decline was due to “smarter, strategic buying techniques” such as bulk purchasing, which his office has long pushed.
Stan Soloway, president and CEO of the Professional Services Council, told Government Executive the decrease is no surprise. His member companies have cut “thousands of jobs as a result of this crazy year, in higher-end skill-set areas, in hardware, and in information technology,” he said. “Every federal agency took a [budget] hit, and there’s no way the contractor community supporting them wouldn’t take a hit.”
But Soloway cautioned against reading too much into the survey as an indicator of a new trend because, with the government having been funded in “in fits and starts, it was an inconsistent and unpredictable year.”
One change that contractors might appreciate this year is a provision in the fiscal 2014 omnibus spending bill nearing congressional approval that would prevent the Obama administration from implementing an earlier plan to require contractor bids to disclose the company’s political campaign contributions.
Soloway says his group supports the ban because such campaign gifts already are disclosed by individual taxpayers and because bidders already want to “avoid the immediate appearance” of inserting politics in the bidding process, and want politics to play no role.