GOVCON Season: What do 2020-2021 Budgets Mean for the Tech Market?
As a new federal fiscal year approaches, agencies have already been making changes to how they will operate in the current environment and how to plan for a future that encompasses the full definition of unexpected. While the US unemployment rate was 10.2% in July, the July DC rate was 8.4% - down from 8.9% in May. With these numbers the labor market around the nation’s capital continues to remain tight, especially in the IT and business services sectors. New jobs are being created not only to replace ones that may have been lost at the start of the pandemic, but also in reaction and preparation to our current and future environments.
Private companies and agencies will continue to shift their spending dollars to react to immediate changes, and also to plan for future needs as the idea of the ‘new normal’ shifts. Even before the pandemic data collection and analysis were a hot topic, but even more so now as new data points are created to meet the needs of how our work, education, health and life now look. We can expect that modernization and overall IT spending from government agencies will increase with the upcoming fiscal year, and there will be initiatives to find new ways to spend remaining funds from the current year’s budget.
Increased spending, a drive for new data, and lower unemployment numbers around the DC Metro area will all lead to a continued tight labor market for these skills. As much as one can, it is important to take these elements into consideration not only of the current and upcoming proposals that may come out from the data needs, but also in order to plan for future staffing requirements. Any time we see lower unemployment rates, especially in the IT and business services sector, we should expect for employees with these skills to be harder to find in the market.
Now is the time to begin thinking through how to assess surge hiring needs, proposal recruiting efforts, and hard to fill slots as internal budgeting takes place. Harder to fill skills mean a longer time to fill for job openings. Thinking about what can be done internally by your recruiting staff and partners to shorten those timeframes will be instrumental as specifics on the recruiting budget are considered. Ultimately, recruiting budgets and strategy planning should be part of the overall conversation around budgets, federal fiscal year planning, and ongoing proposals in this changing environment.