Contracting opportunities slow as economy struggles

Yet cybersecurity, IT infrastructure, health and energy-related IT remain strong growth areas

With the economy growing more slowly than expected, federal contracting dollars are shrinking this year, and many large awards anticipated in fiscal 2011 are either renewals or recompetes of existing contracts, according to recent market research reports.

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“We have a good amount of recompetes and not much in the way of new contracting, and there are ongoing efforts to consolidate existing contracts,” said Ashley Bergander, manager of federal programs at market research firm FedSources, in an interview.

An analysis by FedSources shows a nearly 5 percent decrease in contract spending for the current fiscal year, mostly due to insourcing trends and a reduction in combat-related opportunities, Bergander said.

Yet cybersecurity, IT infrastructure consolidations, health IT and energy-related IT are areas of continuing expansion, she said.

Many of the upcoming contracts are expected to be fixed-price and awarded competitively. “It is a top-down effort to make sure that spending is under control,” Bergander said.

Similarly, market research firm Input Inc. offered its analysis of the largest IT contracts coming up for bid in fiscal 2011.

“Most of the work going through these contracts is ongoing or continuing; there are very few new programs up for bid this year,” the report states.

Many of the recompetes are in the areas of IT services, engineering/scientific services and professional services.

Input also noted that the trend toward multiple-award indefinite-delivery, indefinite-quantity task-order vehicles is continuing this year.

Another trend noted by Input is that contracting offices are opting to break single contracts into multiple-award contract vehicles for follow-on competitions.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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