Contractors and competition highlight the "next economy"

2010 will be the year of the federal contractor according to research by Onvia. The "provider of Business-to-Government solutions" predicts that most of the remaining stimulus money will make its way out the door this year and into the hands of contractors doing the work.

On top of that, "government spending continues to grow," Michael Balsam, Chief Solutions Officer for Onvia which also runs Recovery.org, told Federal News Radio. "At this point, it's running at just over five and a half trillion dollars, which will represent nearly half of Gross Domestic Product," said Balsam, "probably the highest of all time."

As a result, Onvia's report annual report is titled The Next Economy: 2010 Government Market Outlook, and predicts that next economy is "one in which government and businesses operate more closely."

The "big story", said Balsam, "is going to be the impact of stimulus coming in 2010 will be much greater than what we saw in 2009." With 25% of recovery funds paid out by the federal government in 2009, Onvia predicts the bulk of the remainder will "leave Washington and reach the contractors and subcontractors that create jobs."

Specifically, the report predicts:

Jobs - "Across major spending categories," said Balsam, jobs will nearly double as a result of ARRA contract spending compared to 2009. (460,000 in 2009 vs. 1.1 million in 2010.) Onvia forecasts the "Southeast region will see the most job activity, followed by the Far West and the Great Lakes regions."

Infrastructure - The most infrastructure-related jobs will be in the Southeast region, but the most money in terms of average salaries will be in the Great Lakes region, according to the report.

Healthcare IT - Roughly $2 billion in stimulus investments in healthcare IT will continue to be implemented in 2010, says Onvia with another $17 billion available in 2011. Balsam said to watch for "further digitization of electronic records, and, more importantly, setting common standards so when all these institutions finally go digital, they're able to interoperate with common language and technology."

Energy - "Smart grid makes up a good portion" of the projects Onvia is tracking. The report says the "Southeast will receive the lion's share of jobs in this category."