Bloomberg Government’s 2018 Federal Contracting Outlook: The Five Trends That Will Shape Federal Contracting

Washington, D.C. (January 22, 2018) — Bloomberg Government today issued its 2018 Federal Contracting Outlook, which looks at the year ahead for the government contracting marketplace. This year, government contractors can expect the following trends:

  • Information technology modernization fund disbursements through the Modernizing Government Technology (MGT) Act of 2017.
  • Expanded use of “Other Transaction Authority” to make purchases.
  • Increasing opportunities to provide audit services to federal agencies.
  • Growth in the use of “best-in-class” contracts.
  • Progress against procurement policy barriers that affect medium-sized companies (mid-tiers).

“This year government contractors have an opportunity to take advantage of key issues facing the federal government that will shape their priorities in 2018, including a focus on innovative acquisition methods, operational efficiencies, and IT modernization, “ said Donald Thomas, vice president and general manager, Government Contracting, at Bloomberg Government. “Federal government contractors should be optimistic with the uptick in spending that the federal government has experienced since 2012 and is expected to continue throughout 2018.”

A copy of the Federal Contracting Outlook is available for complimentary download at

Highlights of the Outlook include:

Technology Procurement:  The enactment of the Modernizing Government Technology Act will change the way government will buy information technology products and services in 2018. The law established working capital funds for IT modernization at individual agencies.

Other Transaction Authority: The government will increase use of innovative acquisition methods such as Other Transaction Authority. In fiscal 2017, the Defense Department set a record high of $412 million in spending obligations through the use of Other Transaction Authority contracting, according to Bloomberg Government data.

Audit Services: The U.S. government’s requirement to prepare consolidated financial statements will create new opportunities for contractors. DOD began preparing its first-ever agency-wide financial audit last fall, which has translated into more work for companies with auditing expertise — with the potential for follow-on work in the coming years.

Best-in-Class Contracts: Best-in-Class contracts will gain momentum in 2018, as agencies face mounting pressure to squeeze efficiencies out of constrained budgets. This approach enables agencies to take advantage of volume discounts, benchmark labor rates, standardize requirements for common products and services, and gain a better sense of government wide demand.

Mid-Tier Companies: Mid-tier companies, or those defined by annual revenue between $25 million and $500 million, will continue to make progress with policy issues as their numbers and influence expand. The main issues those companies will seek to address will almost certainly be structural procurement barriers such as size standard calculations and teaming restrictions.

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