Deltek Senior Analysts Jeff Webster and Chris Cotner report.
The business and government news has simply has not been good this year. Several states (e.g., California, New York, Texas, Florida, New Jersey, Pennsylvania, Wisconsin, and Minnesota) have experienced wide-ranging problems including budget deficits, significant budget cuts, state shutdowns, contract freezes, public employee layoffs, riots, and massive public protests. The federal government just barely squeaked under the deadline to avoid national default.
However, things are looking up. The feds avoided default. Budget crises have been resolved in every state, as even Minnesota is now back to business. Cuts are coming to most states in FY 2012, but, at least now the states know where those cuts are coming. Other states are finding ways to loosen the belt a little, realizing they may have trimmed a little too close to the good meat (New Jersey). It is starting to feel like the crises are more or less averted and governments are working diligently to get back to business and move forward within their new confines.
We all need good news. However, we do not need the kind of good news that comes with blowing smoke. Rather, the government contracting community needs good news that is based upon solid data and analysis. At Deltek, we bring you just that.
I wrote about the good news of overall budget projections for the states in a previous article (here). Despite the net loss in FY 2012, state budgets are expected to flatten and begin upward growth in FY 2013. However, drilling down, there is more news around which to rally.
As part of our continued analysis of state and local budgets and spending, Deltek developed a set of statistical projection models to examine future trends in the justice/public safety and homeland security verticals (JPS and HS). What we found was more good news. Quite simply, JPS and HS verticals are projected to increase at the state level (see figure 1). The following analysis explains both the methodology and projections in some detail.
For the complete blog, go here.