To everything there is a season, and a time to every purpose – even government contracting. September marks the end of the government fiscal year, a time traditionally marked by a halt in everyone’s vacations and a push to spend ‘use it or lose it’ budget dollars.
While the Army is trying to put an end to the use it or lose it spending spree, the current fiscal environment is still likely to promote more spending as we wrap up FY 2016. Two issues are at play:
- An expected Continuing Resolution (CR) through Christmas (or longer)
- An impending change in administration which will prompt some senior political appointees to start looking for their next opportunity before the November election hits.
Federal contracting data firm GovTribe reported on end-of-fiscal year trends in a series of blog posts last year. Government spending peaks in July –September. In September there are 3.5 times more contract dollars awarded than other months of the year.
If you’re a recruiter or hiring manager, should the government’s fiscal year matter to you? Absolutely. When establishing your recruitment cycles it is critical to keep in mind the government’s fiscal timeline.
Use it or Lose it and the Cost of another Continuing Resolution
The end of fiscal year sprint means many contracting professionals put their September vacation plans on hold.
“We try to be available for our customers, so those that have year-end funding, can make good use of this window to get funding applied for meaningful objectives,” said Brad Antle, CEO of Salient CRGT.
That said, Antle emphasized that Salient CRGT aims to help customers make better buying decisions throughout the calendar year.
“I’m a big fan of trying to use money throughout the year and not waiting until the end of the year to spend it,” said Antle. There are specific circumstances where the government is smart to spend today rather than waiting. He noted that sometimes the government will fund a program in advance, using FY 2016 dollars to pay for 2017 priorities.
Even if use it or lose becomes a thing of the past, a CR will absolutely affect how dollars are allocated after Sept. 30.
“A continuing resolution means there won’t be any new starts coming online, so the customer will have to be spending at a level commensurate with 2016 levels,” said Antle.
Congress is back in session this week – but they’re not likely to make progress on the 2017 budget. A CR seems so inevitable that news reports are already focusing not on ‘if’ a CR will occur, but how long it will be. Some members of congress are pushing for a six-month CR that would fund the government through the next administration. Others are advocating for an end-of-year budget deadline, which historically has produced more last-minute spending – or a government shutdown.
The good news for recruiters is that a CR is almost tantamount to ‘business as usual’ in Washington. But it does mean that new spending measures will likely be on hold. If you’re making a big push for a new contract, September is still prime time.
Be ready for talent to make a move
The July-September timeframe is an active one for acquisition professionals. Top talent may find itself in the crosshairs of contract bids and renewals. While their companies are shifting priorities, it may be a season where some professionals are ready to shift into a new position. Savvy recruiters are selling their positions all year, but the end-of-fiscal-year timeframe is a critical one for attracting mid-level and senior professionals.
Recruiters should work with their contracting and acquisition peers to establish where contracts are being won and lost. Be ready to move talent within your organization, and also to grab professionals working for the companies who your company may have replaced in a contract award.
Also, be ready to beef up your existing teams. The end of fiscal year can be a great time to add talent where it’s needed. Make sure your talent pipeline is ready, and make the case for why it’s a great idea to spend end-of-fiscal year dollars to fund the kinds of salaries it takes to lure in the best.
“Historically, fiscal year has been a good time for us to bring on additional labor that was not yet identified in the initial contract,” said Maria Whitney, senior recruiter at Smartronix.
This year even more professionals are likely to be looking. The election cycle usually creates some churn in Washington, D.C., particularly for political appointees or higher-level government professionals. They’ll be looking to find a new job before a new president takes office. The good news for recruiters? Their government experience can be a great asset.
Gear up for the new fiscal year
The good news in all of this crazy government contacting business? It’s never too early to start planning for the year to come. Defense budget numbers could go up in the new fiscal year, if Republican lawmakers get their way.
End of Fiscal Year Checklist
- Talent audit: Audit your existing talent pool. Where are your top performers located? Which contracts could use more talent, and how can you convince program managers to allocate end-of-fiscal-year dollars to increase salaries?
- Recruiting marketing: Internally, if you have dollars to spend, consider how they could be used to increase your visibility with the right candidates. Are you posting all of the jobs you need to in order to attract talent? Do you have a fully optimized career profile? Are you updating it regularly? The end of fiscal year gives you a chance to audit yourself before the end of the calendar year – and make a final push to build your pipeline.
- Take a talent pipeline inventory: While you might think the current cleared recruiting market is too tight for a successful pipeline, maybe you need to reevaluate your definition of a pipeline. Your talent pipeline is inherently filled with candidates who are happily employed. That doesn’t mean they wouldn’t move for the right opportunity. Take a look at the contracts you have coming in the next couple of months, and consider who in your pipeline might be motivated by the salary or the mission. Add notes and update the tags you use to track your talent pipeline. The uncertainty of the CR and the churn of the election cycle might create the kind of disruption that makes some professionals consider new opportunities. And you won’t be ready to take advantage if you haven’t built (and kept in touch with) a robust pipeline of talent.