On March 23rd, President Trump signed a $1.3 trillion spending bill for fiscal year 2019 which allocates $686.1 billion for the Department of Defense™s budget. The spending bill, which marks a 5 percent increase over the initial FY 2018 President™s Budget and a 10 percent increase over the current continuing resolution, calls for an additional $47 billion to be added to the DoD™s budget.
The FY 2019 budget, much like FY 2018, seeks to enable a more efficient and capable armed force that œcan project power globally for full-spectrum operations against a range of threats. The DoD FY 2019 Budget Request Overview notes that the budget aims to:
- Grow the size of the U.S. Army, Navy and Air Force by over 25,000
- Continue the Missile Defeat and Defense Enhancement initiative
- Increase and speed up the procurement of preferred and advanced munitions
- Modernize the second Army Armored Brigade Combat Team™s equipment
- Buy ten combat ships in FY 2018
- Increase production of F-35 and F/A-18 aircraft
- Enhance deterrence via nuclear triad modernization
- Increase funding to enhance space communications and resiliency
- Increase U.S. Armed Forces pay by 2.6 percent
- Emphasize technological innovation and lethality
With such a wide variety of goals to achieve in FY 2019, the government will need greater assistance from industry, which means that FY 2019 is looking to be another strong year for the GovCon marketplace, continuing a trend that the industry has been experiencing since FY 2015.
FY 2018 has been a robust year for government contractors thus far, with many high-value contracts awarded to companies like Boeing,Northrop Grumman, Lockheed Martin, Raytheon and General Dynamics. FY 2018 has been an impressive year not just for the œBig Five, but also for medium and small-sized government contractors, with many such companies being awarded spots on contracts such as the $25 billion VA VECTOR contract and the $15 billion GSA Alliant 2 Small Business GWAC.
The upward trend of the defense budget since FY 2015 has been benefiting companies across the board. DynCorp International reported an impressive FY 2017 with a 9.2 percent increase in revenue, ManTech International recorded a 7 percent increase in revenue from FY 2016 to FY 2017, and CACI International™s Q2 2018 results have shown a 2.9 percent increase in revenue.
Based on the increased defense spending over the past four years, FY 2019 will certainly be a strong year for government contractors. With an ambitious list of priorities outlined in the FY 2019 Budget Request Overview, the federal government will need the assistance of industry to accomplish its goals. The GovCon community can expect to see a large amount of contracting activity centered around the defense industry in the coming fiscal year and many opportunities for growth.
The Wash100 popular vote continues and will be open for another month. Voter participation has substantially increased between 2017 and 2018. An additional 2,029 votes have been tallied for the top five popular vote recipients in the 2018 Wash100, more than 2.5 times the 2017 polling results.
The Executive Mosaic team would like to extend our sincerest thanks to those who have participated in the Wash100 popular vote. Your votes help to recognize the individuals who are expected to have the greatest impact on the GovCon marketplace in the coming year.
If you would like to participate in the vote and have your voice heard, please visit the Wash100 voting page at any time prior to April 30th, 2018 and cast your ten votes for the executives you believe will have the greatest influence on the 2018 GovCon landscape.
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