Report: Expect Growth in Government IT Spending in 2017

The market research firm Onvia doesn't expect the next president to change much for the government technology business — at least not immediately.

by / December 16, 2016

Onvia, a business-to-government market intelligence firm, thinks government information technology spending will continue to grow under the Trump administration.

In a 2017 forecast, the organization predicted steady growth and counseled that even if the new administration makes big changes to government spending, it will take several quarters for those changes to show up in government priorities and budgeting.

Meanwhile, with the economy steady, the report asserts that IT spending should continue to grow at a healthy clip — essentially, the status quo. According to the firm’s analysis, the adjusted IT spend from state, local and education entities has grown 17 percent from $29 billion to $34 billion between 2010 and 2016.

The report noted that government should have growing demand for cybersecurity and demonstrably secure technology, given a buzzing concern of hacking and infiltration across the country. Even as hackers have stolen information from private companies, they have turned to government as well, at times jeopardizing sensitive information such as Social Security numbers.

“More and more government buyers will be asked to articulate and defend the cybersecurity posture of new IT purchases, often requiring alignment with federal, state or government-specific standards,” wrote Ben Vaught, director of Onvia Exchange, in the document. “More governments will ask for — and receive in greater frequency — funds to replace old and vulnerable systems under the guise of cybersecurity concerns.”

The future also promises increases in infrastructure spending, with the Trump administration promising $1 trillion in funding for projects and voters approving another $200 billion in infrastructure funds through ballot initiatives. Dan White, a senior economist at Moody’s Analytics, said in the document that the new administration appears to want government to work closely with private industry on such initiatives — in other words, public-private partnerships, or P3s.

“The new administration hasn’t, at least publicly, fleshed out its plans in a very detailed way,” White wrote. “However, it has made it abundantly clear that it wants the private sector to play a significant role. Those governments who best understand how to take advantage of P3s will be ahead of the curve once a bill is put into place.”