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Deltek Reveals Top Government Contracting Business Development Trends for 2022

Deltek’s research team identifies four key areas of focus for government contracting markets

Deltek, the leading provider of software and solutions for project-based businesses, announced that its GovWin IQ research team has revealed business development trends expected to make the greatest impact on the federal and SLED (state, local and education) government contracting markets in 2022.

The government contracting market is increasingly competitive. In order to develop a winning strategy, government contractors need to understand external factors that play key roles in impacting the contracting market, and actions needed to better prepare themselves for success. Deltek’s GovWin IQ research team consists of over 150 veteran market analysts, industry experts, and intelligence input from government decision makers. This team has identified four themes expected to define 2022: Impact of new funding sources and appropriations; Expanding compliance requirements, Focus on small businesses; and Increased contract consolidation.

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In early 2022, the GovWin research team will also explore details of these trends in a two-part webinar series covering both the federal and SLED markets.

“Our research has shown that several themes are likely to make an impact on how government contractors operate in 2022,” said Kevin Plexico, Senior VP of Information Solutions at Deltek. “The impacts of contract consolidation and expanded compliance requirements will be vital for contractors to understand, while the opportunities unlocked by new funding sources and an increased focus on small businesses can help proactive companies expand their government contracting operations. Understanding these themes is of great importance for public sector vendors aiming to get ahead of their competition and win more government business.”

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The four key trends identified by the GovWin research team fall into the following categories:

  1. Impact of new funding sources and appropriations. Several notable pieces of legislation recently passed which may create a trickle-down of funding for federal, state and local agencies. The Infrastructure Investment and Jobs Act passed in November 2021 unlocked hundreds of billions of dollars in funding for roads, bridges, mass transit, technology infrastructure and much more. Also, the American Rescue Plan Act (ARPA) of 2021 sent down nearly $200 billion to the states and another $125 billion to local governments and authorities. Monitoring which potential upcoming projects may be impacted by this funding, as well as the possibility of future major legislation, will be a recurring theme for 2022 that all contractors will need to watch.
  2. Expanding compliance requirements. There is a broad range of new and important requirements impacting government businesses. For example, the recent Federal mandate requiring government contractors be vaccinated unless a medical or religious exemption applies.  Many businesses are rushing to formalize policies in conjunction with employees who are hesitant to receive the vaccine. Several additional requirements are likely to impact contractors in 2022, such as Cybersecurity Maturity Model Certification (CMMC) as well as diversity and inclusion compliance.
  3. Focus on small business. This past year revealed an increased focus within the federal government to help small businesses become more successful, and increase investments in small disadvantaged businesses (SDBs). One way that focus is becoming operationalized is through an initiative to increase the SDB set-aside goal from 10% to 15% by FY 2025. Other government priorities may evolve into policies in 2022 as well.
  4. Contract consolidation. Agencies such as the General Services Administration (GSA) is expected to continue consolidating contracts, resulting in fewer potential prime contracting opportunities. At the state and local level, several national co-ops have reported growth of up to 15% in sales while bids declined up to 15% – meaning that while more money is being spent, it is generally in fewer, larger contract opportunities, which is likely to create an increasingly competitive contracting environment.

For more information on these topics, the GovWin research team will host two presentations in January 2022 that will explore these themes in detail. The Federal Contracting Trends webinar is scheduled for Tuesday, January 4, followed by the SLED Contracting Trends webinar on Thursday, January 6.

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