GEIA sees 3.6 percent annual growth for fed IT

The federal IT market will increase an average 3.6 percent annually from fiscal 2005 to 2010, according to a forecast issued by the Government Electronics and Information Technology Association.

The trade association's annual forecast of the federal information technology marketplace expects the anticipated budget of $60.8 billion in 2005 to grow to $72.9 billion in current dollars by fiscal 2010. IT accounts for more than 7 percent of the federal government's total discretionary budget, GEIA said.

The total growth rate is lower than last year's forecast for annual growth of 4.1 percent because of the need for consolidation and cost cutting as the growing federal deficit squeezes discretionary budgets, GEIA said.

GEIA also forecasts that the civil portion of the government's 2005 budget will be $32.1 billion and have an annual average growth rate of 2.9 percent with most of the growth coming from the Homeland Security and Health and Human Services departments.

Reduced discretionary budgets will make for lower growth rates at the departments of Agriculture, Energy and Interior, the trade group said.

The Defense Department's IT budget of $28.7 billion in fiscal 2005 will grow 4.4 percent during the forecast period to $35.6 billion in 2010, GEIA said. Much of that growth will be driven by the global war on terror and infrastructure upgrade requirements.

The Arlington, Va., trade association based its forecasts on interviews with senior officials and decision-makers from defense and civil agencies, oversight agencies, Congress, the administration and investment firms.

GEIA will hold a conference on the annual forecast for the federal IT and defense marketplaces Oct. 12-14 at the Sheraton Premier Hotel at Tyson's Corner in Vienna, Va.