Whether you are a government contractor or wish to become one and start bidding on contracting jobs, it’s important to understand that when the country shifts leadership, this can affect the world of government contracting.
What’s in store for 2025? With a new administration, a federal contractor may encounter shifts in policy focus, priorities, and regulatory requirements. Here are several areas where federal contracting could change under a new administration, but keep in mind, that these are generalizations that could happen no matter the candidate or the political party.
- Shifts in Budget Priorities
An administration often reallocates federal budgets toward its policy priorities. For instance, there may be increased funding for areas aligned with the administration’s agenda (such as defense, infrastructure, or technology). Conversely, other sectors might see reduced budgets, potentially impacting the availability of government contracting in those areas.
- Regulatory Adjustments
Changes in regulations are common with a new administration. An administration focused on deregulation might reduce compliance requirements for contractors, aiming to streamline contracting processes and cut down on bureaucratic hurdles. This could mean less oversight with some federal government contractor jobs but also fewer protections or stricter rules in others, depending on the sector.
- Contracting Opportunities for Small Businesses
Different administrations have varied approaches to supporting small businesses, especially those that are minority-owned or veteran-owned small businesses. New incentives, quotas, or changes in eligibility for set-aside programs might occur, impacting the landscape for a small business in federal contracting.
- Emphasis on “Buy American” Policies
A strong “Buy American” stance could lead to increased requirements for domestic sourcing and production in government contracts. This may benefit United States-based companies and manufacturers while posing challenges for contractors who rely on international suppliers.
- Focus on Specific Sectors (e.g., Defense, Technology, Infrastructure)
An administration might focus federal resources on specific sectors, leading to increased contracting opportunities in some government agencies. For example, prioritizing defense spending could mean more Homeland Security or DOD contracts related to military technology, cybersecurity, and infrastructure.
- Labor and Wage Policies
Labor policies, including minimum wage adjustments or labor protections for federal government contractors, may change. Some administrations may push for higher wages and better benefits for workers on federal contracts, while others might focus on reducing costs and regulatory requirements for employers.
- Increased Scrutiny of Contractor Ethics and Performance
New rules or increased oversight for contractor performance, ethics, and accountability might be implemented. This could include more stringent background checks, ethical requirements, and performance evaluations to ensure contractor reliability.
- Greater Emphasis on Cybersecurity Standards
With increased cyber threats, federal contractors may face more stringent cybersecurity requirements, particularly for government contract jobs that involve working with sensitive information. This could mean higher compliance costs for contractors needing to meet updated security protocols.
- Potential Changes in the Federal Acquisition Process
New administrations sometimes seek to reform or expedite the federal acquisition process such as changing federal acquisition regulations. This could result in changes to how contracts are awarded, making the process faster or reducing barriers for businesses to enter federal contracting markets.
Each of these areas reflects common shifts that can accompany a new administration. For federal contractors, staying informed and adaptable to policy changes can help them navigate the evolving landscape and maintain compliance.
How Could Higher Tariffs Affect Government Contractors?
President-elect Trump suggested that raising tariffs is a component of his economic plan. While we don’t know yet if this will materialize and to what extent, higher tariffs can impact government contractors, particularly for those who rely on imported materials or components. Here’s a look at how higher tariffs might impact you as a federal contractor.
- Increased Costs for Materials and Supplies
Government contractors who rely on imported materials (such as electronics, metals, or specialized parts) may face higher costs due to tariffs. These increased costs can impact profit margins, especially for contracts awarded at fixed prices that don’t adjust for fluctuating material costs.
- Challenges Meeting “Buy American” Requirements
With higher tariffs, contractors may shift toward domestic suppliers to comply with “Buy American” policies, which could increase costs if domestic options are limited or more expensive. This shift may also limit options, affecting product quality or lead times.
- Impacts on Small and Mid-Sized Contractors
Smaller contractors, often with tighter budgets, may be more significantly affected by rising material costs, making it harder for them to stay competitive or meet contract requirements. This could impact their ability to win future bids or to meet obligations on current projects.
- Potential Delays in Project Timelines
Contractors may experience delays if they need to source new materials domestically or seek alternative suppliers. Adjusting to higher tariffs might mean renegotiating supply chains, which can push back project timelines.
- Greater Need for Cost Management and Budget Adjustments
Higher tariffs may require contractors to adopt more rigorous cost-control strategies, especially for long-term projects. Budget adjustments and financial forecasting could become essential to mitigate the effects of rising costs on project viability.
- Price Adjustment Clauses in Contracts
In response to higher tariffs, contractors may seek price adjustment clauses in new contracts to account for potential fluctuations in material costs. These clauses can help protect contractors but may also lead to more complex negotiations with government agencies.
- Opportunities for Domestic Suppliers and Manufacturers
Domestic companies may benefit from higher demand if government contractors shift away from imported materials. This could foster new relationships with U.S.-based suppliers, ultimately benefiting contractors focused on building domestic supply chains.
Government contractors who can adapt to these changes by building relationships with local suppliers, managing costs effectively, and incorporating price adjustment strategies may be better equipped to handle the challenges that come with higher tariffs.
How To Become A Government Contractor
While the administrations may change, government contracting will still provide many business owners with many lucrative opportunities. Before you can work as a contractor or subcontractor, however, you will need to complete your registration in the System for Award Management (SAM).
SAM registration is a requirement for anyone selling products and services to the United States government and no federal agencies will work with contractors that do not have an active SAM registration. While the government does not charge a fee for SAM registration or SAM renewal, the process is extremely complicated and can take 10 or more hours to complete.
Many business owners simply hire a third-party SAM registration service to complete their registration. At Federal Contractor Registry, we handle hundreds of SAM registrations and renewals each year and will complete your application 100% accurately and as quickly as possible. Once we’ve completed your application and it’s been approved by the General Services Administration’s Federal Service Desk, then you will be eligible to bid on government contracting jobs.
In addition to completing your SAM registration, we also will help you sign up with the Small Business Administration, if applicable. We also can help determine which small business set aside best fits your business, whether it’s 8a certification, HubZone Certification, Woman-Owned Small Business (WOSB) or perhaps Service-Disabled Veteran-Owned Business (SDVOSB), etc.
Additionally, we also will help you with the SAM notarized letter requirement and help you attain your Unique Entity Identifier, or UEI number, which you must have to register in SAM. All of these services will be included in our SAM registration fee.
Get Started With Government Contracting
No matter who might be in the Oval Office, there are plenty of opportunities for government contracting. Whether you wish to bid on hurricane relief jobs or disaster relief jobs, or you have essential services or goods that federal agencies need, becoming a government contractor can be extremely lucrative and help you expand your business. To get started with SAM registration, just head to our homepage, click on the green New Registration tab, and fill out our quick contact form.