As organizations navigate the changing landscape under the new administration, it is essential to understand DOGE’s impacts.
Fact: The US Government Budget – Including for Government Contracting – Will Still Be in the Trillions of Dollars….growth[period] has an unapparelled network of former U.S. government officials and subject matter experts. Our experts’ networks, insights and experience help our clients navigate a successful path forward through the twists and turns of DOGE. Despite the proposed changes by DOGE, the federal government budget will remain in the trillions* of dollars. This Administration also favors privatization and outsourcing. Thus, allowing for opportunities for the government contracting sector to fill gaps. [*In FY 24 the government spent $6.75 trillion USD. Even if it is cut in half the government will spend over $3 trillion USD annually. Source: Congressional Budget Office]
–
Fewer Contracts in Some Areas – Increased Spending in Others. The reality is that if your company provides any diversity, equity and inclusion related services those contracts are gone. However, the Trump Administration places a heavy emphasis on defense spending. This is also true in the context of Secretary Hegseth’s guidance on proposed cuts to the Pentagon’s budget.
The House on February 25th passed a budget blueprint that invests an additional $100 billion in defense over the next decade. This is part of a sweeping Republican plan to enact President Trump’s agenda. This may seem oxymoronic, but it underscores how nuanced these activities are. The purpose of the defense budget is to bolster our ability to defend the nation and deter aggression against America or our allies and partners. That purpose still remains. The bipartisan resolve to sustain it transcends DOGE. In FY 24 total US Defense spending was approximately $850 billion dollars. Even with tradeoffs in defense spending priorities the spending across the sector is strong.
–
Effects on Small Businesses. The Trump Administration is suggesting that small business set aside categories, such as 8a, should be eliminated or sharply curtailed. These set aside programs have broad support across both aisles in Congress. However, if these programs are eliminated, small business size standards and NAICS codes are applicable for contracting officers to leverage. This continues to provide opportunities for small businesses to compete successfully to win prime work with the government.
–
Performance based metrics. This emphasis by DOGE just underlies the already existing trend of federal agencies increasingly favoring performance-based contracting models that emphasize measurable efficiency over flexibility. Such an environment enables agencies to increase their reliance on Other Transaction Agreements (OTAs) and Indefinite Delivery/Indefinite Quantity (IDIQ) contracts. These types of contracts allow agencies to scale contract awards up or down based on flexible and shifting metrics and budgetary requirements and are not new to the federal contracting landscape.
–
Weekly Updates. growth[period] publishes a Weekly Administration Update that can help you track and understand how DOGE will impact your company. Please send us an email at hcongdon@growthprd.com if you wish to be added to the list. Our experts are also available to help your organization chart a smart way forward to ensure growth in the shadow of DOGE. Please contact us at info@growthperiod.com and let us know how we may best help you continue to succeed.
