Federal IT Market, 2023-2027

Published: June 30, 2023

FeaturedFederal Market AnalysisForecasts and SpendingPolicy and Legislation

Deltek’s Federal IT Market, 2023-2027 report analyzes the market trends, policies and principal initiatives that will shape federal information technology spending over the next five years.

Deltek forecasts federal spending on contractor-supplied Information Technology (IT) products and services will grow from $116.4 billion in FY 2023 to $137.5 billion in FY 2027.

The federal IT landscape continues to evolve as agencies work to embed new capabilities – from cloud computing and cybersecurity to artificial intelligence and analytics – into their IT environments. Within the context of fast-changing geopolitical and economic forces, the federal IT landscape is an increasingly complex amalgamation of future needs and current realities, as agencies seek to embrace rapid technological change while also addressing embedded legacy infrastructure.

In its priorities, policies and budgets, the Biden Administration continues to emphasize IT modernization, cybersecurity and investments in key technologies as enablers of citizen services and critical mission objectives. This technology agenda presents broad opportunities in systems modernization and support, cybersecurity, cloud computing, data analytics, artificial intelligence, and process automation. As a mission enabler, IT is a critical part of a wide range of programs, spanning professional services, R&D, defense & aerospace and operations & maintenance activities. At the same time, agencies remain under pressure to increase efficiency, eliminate waste and demonstrate clear value for their IT investments.

Deltek forecasts the federal IT market will continue to experience moderate but uneven growth over the next five years as agencies seek to address multiple administration technology priorities and mandates, and invest in IT capabilities that add new operational capacities and effectiveness.

Key Findings

  • Critical Technology Priorities. Agencies continue to prioritize investments in critical technology areas, including cloud, cyber, big data, AI, health IT, mobility/5G and network modernization. IC agencies are leveraging these technologies as well as modeling and simulation and virtual/augmented reality.
  • Multifaceted Cybersecurity. Policies for Zero Trust, cyber data collection and sharing, vulnerability and incident response, cloud security and software supply chain security – as directed by Executive Order 14028 - are driving higher investments in cybersecurity solutions, including those that are cloud-based.
  • Data-driven Government. Enterprise-scale analytics platforms have become common across the federal government and will continue to grow.
  • Software Development. Agencies continue a focus on DevOps, DevSecOps, human-centered design and the use of APIs and microservices in software development practices and modernization efforts.
  • Emerging Tech. The Biden Administration continues to prioritize technology R&D within agency budgets, including AI, cybersecurity, quantum, autonomous systems, networking and wireless spectrum.
  • Tech Acquisitions. Training the federal acquisition workforce in technology procurement remains a challenge that has drawn the attention of Congress in legislation such as the FY 2024 NDAA.

Critical Insight for Vendors

Deltek's Federal IT Market, 2023-2027 report takes a strategic 5-year look at the trends, drivers, and inhibitors shaping federal information technology procurement. The scope of Deltek’s analysis includes traditional IT and embedded IT spending within non-IT programs.

The report provides:

  • Insight into the factors, policies, and technologies shaping the market landscape over the next five years.
  • Insight into the dynamics shaping IT market segments and agency spending.
  • Insight from industry and government thought leaders.
  • Market forecasts to support vendors’ strategic planning.
  • Recommendations to help contractors evaluate the impact of trends on their businesses.

Deltek's Federal IT Market, 2023-2027 report is delivered in PowerPoint® format, including a PowerPoint® Executive Briefing, and an Excel® data workbook.




  • Report Purpose
  • Scope and Methodology
  • Market Segmentation and Definitions
  • Key Findings

Federal IT Trends and Drivers

  • Budget Environment
  • Technology Priorities and Policy Drivers
  • Acquisition Environment

Federal IT Market Forecasts

  • Factors Impacting Spending Trajectory
  • Total Addressable Market
  • Addressable Market by Buyer Segments (Defense and Civilian)
  • Addressable Market by Technology Segments
    - Applications
    - Computing
    - Network
    - End User
    - IT Management
    - IT Service Delivery Management
    - Platform
    - Storage
    - Data Center
    - Embedded IT
    - Security and Compliance

Defense Analysis and Forecasts

  • Defense Agencies
  • Navy
  • Air Force
  • Army

Civilian Agency Analysis and Forecasts

  • Health and Human Services
  • Veterans Affairs
  • Homeland Security
  • Treasury
  • State
  • Justice
  • Transportation
  • Commerce
  • NASA
  • Energy
  • Agriculture
  • Social Security Administration
  • Interior
  • General Services Administration
  • Education
  • Labor
  • Environmental Protection Agency
  • Housing and Urban Development
  • U.S. Agency for International Development
  • Small Business Administration
  • National Science Foundation

Intelligence Community Analysis and Forecasts

  • Total Addressable Market
  • Addressable Market by Intelligence Program
  • Addressable Market by Technology Segments
  • IC Agency Plans and Initiatives

Conclusions and Recommendations