Looking Ahead: 2026 Federal Acquisition Priorities

The federal contracting landscape is undergoing a record wave of change.  The influx of policy changes, efficiency initiatives and regulatory alterations under the Trump 2.0 Administration are reshaping the acquisition environment this year. largely defines the changes in acquisition environment this year. Contractors should anticipate these changes continuing to influence the market as they move into 2026.

Each year, the Federal Market Analysis team delivers a comprehensive report outlining the key areas of focus for contractors in the upcoming year. As the federal landscape continues to evolve, staying attentive to these trends is more critical than ever. Identified trends include specific IT “hotspots” such as cybersecurity and AI, the economic environment, impacts from acquisition reform, agency workforce and reorganization changes, and expectations for small businesses, among others. Deltek’s Federal Trends to Watch in 2026 offers key insights for federal contractors to adapt quickly in a transformative federal environment.

Key Trends to Watch

• Budgets and Spending: Post-shutdown contracting delays, DOGE-driven terminations and stark defense/civilian bifurcation ($831B+ defense vs. declining civilian budgets) have created unprecedented market volatility. Given the multiple continuing resolutions for FY 2025-2026, the final FY 2026 discretionary budget will provide much more insight into the administration’s real spending agenda.
• The Economy: The Trump Administration tariff agenda has contributed to some economic instability. Mixed economic signals show 3.8% GDP growth alongside rising inflation, wage pressures, and other costs that contractors cannot fully recover under fixed-price contracts.
• GSA Acquisition Reform: In its role as executive agent, GSA is tasked with contract consolidation, leveraging various strategies including the new Office of Centralized Acquisition Services (OCAS), OneGov direct-to-OEM purchasing, and pending mandates for the use of existing government-wide vehicles.
• FAR Overhaul: The Revolutionary FAR Overhaul (RFO) strips the FAR to statutory essentials, grants contracting officers broader discretion across set-asides and source selection, and mandates "commercial-first" approaches prioritizing existing vehicles over new procurements. Although agencies can incorporate RFO revisions now, formal rulemaking to codify the changes is expected to begin in earnest in 2026.
• Defense Reform: DOD’s broad acquisition reform strategy will take shape in 2026. The recently released Acquisition Transformation Strategy empowers new Portfolio Acquisition Executives (PAEs) with consolidated authority, mandates modular open systems approaches, and prioritizes Other Transaction Agreements (OTAs) and Commercial Solutions Openings (CSOs).
• Small Business: Small business participation continues declining, an existing trend exacerbated by the disproportionate impact of DOGE contract terminations in 2025. Facing a range of challenges – from category management consolidation and potential 8(a) program changes to increased fixed-price risk and cash flow pressures – small businesses will require robust strategies and relationships to drive success in 2026.
• Cybersecurity: Cyber compliance will continue to be a significant operational and financial consideration in 2026. CMMC phased rollout began in November 2025, requiring Level 1-2 self-assessments initially and progressing to Level 2-3 certifications through 2028. The proposed government-wide FAR CUI rule would extend NIST cybersecurity standards beyond DOD, and FedRAMP 20X aims to accelerate authorization processes.
• Artificial Intelligence: The White House AI Action Plan directed 90+ policy actions across innovation, infrastructure, and international leadership pillars in 2025. In 2026, contractors can expect more attention and a wide range of legislation focused on both government and private sector use of AI.
• Agency Reorganizations: Executive orders and policies early in the administration set the stage for government-wide Agency RIF and Reorganization Plans (ARRPs) consolidating duplicative functions, the elimination of offices and the centralization of administrative functions such as HR, IT, and procurement. Agency structures will continue to evolve and take root in 2026, requiring contractors to expand and adjust customer intelligence strategies.
• Federal Workforce: Workforce reductions have been a key priority for the Trump Administration, resulting in the elimination of 317K federal employees and several executive orders designed to “right-size” both the civilian and defense workforce. The true state of the federal workforce remains unclear due to stagnant reporting, but 2026 is likely to provide more insight, particularly in areas that cause procurement bottlenecks, such as contracting, program management and IT.