Bloomberg Government hosted a breakfast panel this Tuesday at their offices in downtown DC, "Federal Budget and Contracting Trends: US Army Discussion" with the expert opinions of Kevin Brancato, Cameron Leuthy, and Robert Levinson; all distinguished federal and defense analysts. Below are my takeaways and personal thoughts on the talk and it's implications for contracting and NiyamIT.

The long-term financial landscape is embroiled in fog for the armed services, particularly the Army. This is reflected in the steep drop in budget authority starting in 2026 through 2041. Force reduction, modernization efforts and mandated decreases in expenditures are forcing change in the budget and procurement forecasts. 

Force reduction projections have been forecasted by the Department of Defense from 560,000 to closer to 450,000 over the next 4 years; however, in the face of more fiscal the Strategic Choices and Management Review (SCMR) says uncertainty numbers could drop as low as 380,000. This not only impacts force readiness in terms of number of able-bodied troops, but also for contractors and support staff. As their numbers are reduced, the budget offices must weigh "grey" and "green" personnel; in the wake of these tough decisions it is far more likely that contractors will suffer the greater loss.

As numbers decrease, there is a parallel mandate to modernize and automate the armed forces. Drone and other unmanned systems, cybersecurity and IT driven programs are increasingly important priorities in the modern battlefield. Based on the top ten opportunities for federal government acquisitions, seven are IT and technology related. This is particularly important for firms offering services to the government, as we move towards a privatized model of competitive procurement and further handoffs to the private sector to provide cost-effective solutions to government challenges.

These technology offerings are crucial given the current economic climate as most of the federal government and armed forces are maintaining existing systems and technology, waiting for major advances to invest in. NiyamIT offers a host of solutions in big data, military EHR/EMR, GIS, BPM, custom software, and more. We focus on a cost-effective bespoke solution designed to exceed expectations and add value. Contact us at info@niyamit.com, or visit our website to learn more.

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