Government agencies and contractors should expect to continue to tighten their belts in the 2012 budget, but intelligence and cyber spending, while they may take hits, should remain relatively stable.

“A peanut butter spread across all sectors of government is not a likely scenario,” said Ray Bjorklund, FedSources Vice President and Chief Knowledge Officer, while speaking to a group of contracting industry leaders at the 26th annual Federal Outlook Conference. Meaning, spending cuts will not occur evenly across all agencies. There will be winners and losers in the 2012 budget.

Growth areas include telecommunications, architecture and engineering, as well as student aid administration and financial oversight.

Information technology and cybersecurity spending are expected to remain relatively flat, although Bjorklund cited the problems with defining cybersecurity as a hindrance to tracking exactly how much of it is in the 2012 budget. Bjorklund speculates approximately 8 billion dollars in cybersecurity spending, but noted some would say anywhere from 3 billion to 18 billion.

The jury is still out on insourcing initiatives, said Bjorklund. A lot of people have opinions on whether it’s cheaper to use contractors or government workers for the same tasks, but they don’t have the research or data to back their opinions up.

Despite efficiency initiatives and the need for savings across government, it’s not a gloom and doom picture for federal contractors, however.

“If you have smart solutions to help the acquisition workforce improve its workflow you will see opportunities,” said Bjorklund.

Bjorklund gave several points of advice for those looking to do business in the next year.

  • Don’t become enamored with political speak. Companies need to stay above the ebb and flow of Congressional and White House debates. There is a lot of speculation about programs and cuts but don’t rely solely on the latest budget rumor.
  • Know the constraints government is under, and plan accordingly. Keep enough cash on hand to cover payment delays and know that there will be hesitancy to put additional dollars into programs.
  • Keep key personnel and use them wisely. “Don’t send your warriors out to attack all agencies” said Bjorklund. Focus on key programs, contracts and relationships.

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