Federal IT Market: 2013 Was Tough, But It's A New Year


While the past year was a tough one, there is optimism for the federal IT market in 2014. Already, uncertainty around the possibility of a second government shutdown in January has been quelled as President Barack Obama signed a budget deal on Dec. 26 to stave off another crisis for two more years.

In particular, there are growing opportunities in health care after the passage of the Affordable Care Act, Ingram Micro's Humke said. It can be a "political landmine," he said, but for businesses with the infrastructure and investments lined up to make it work, it can be a huge opportunity. Across the board, indicators such as the economy and unemployment rates are picking up, he said, which is a good sign as 2014 gets on a roll.

"I wish I had a crystal ball, I really do. ... I think we're going to continue to be [hit] hard in '14. We're still coming out of a lot of issues, a ... variety of things that haven't settled out yet," Humke said. "I don't think it's going to be a boomer year, but I do think it's still going to be a struggle. I still think you're going to have budget issues. I think you're going to have to fight for the business you're getting, but I'm hoping dollars will start to loosen up," he said.

Halligan of n2grate said his company has already hired four more people in the last 30 days to prepare for a big year of business. He said the upside of a difficult market means great talent is easier to come by.

"It's a calculated risk we're making from our budget standpoint, but it's an uncertain budget from a customer standpoint," Halligan said. "We will continue to make investments to plan for it. But that uncertainty around government funding, it's in the back of our minds, but we need to press on and carry on in our own investments if we're going to have a stronger 2014 in general," he said.

While it may sometimes be hesitant to hand over the dollars, the government can't back away from technology now because the citizens are demanding more and more technology and Internet connections, CSC's Hushon said.

The bottom line? While government might not necessarily be spending money left and right, there is optimism for more spend going into next year, Humke said.

"I think, 'Will it be as bad?' God I hope not," Humke said.

PUBLISHED JAN. 2, 2014