The federal workforce got smaller in 2025. The mission did not, and neither did the budget. Here is why we think a wave of solicitations is stacking up into 2026 and 2027, and what is driving the consolidation underneath it.
The easy assumption after a year of cuts is that federal contracting must be contracting too. Fewer employees, a Department of Government Efficiency built to shrink the state, headlines about canceled programs. If the government is spending less, surely there is less work to win.
We read it differently. The workforce shrank, but the money and the mission did not, and the plumbing of how the government buys is being rebuilt in a way that favors organized contractors. This is our outlook, not a forecast anyone can guarantee, but the underlying facts are documented and they point the same direction.
DOGE drove a real and historic reduction in headcount — on the order of 300,000-plus federal employees in 2025. But as the Cato Institute noted, it produced the largest peacetime workforce cut on record while spending kept rising. On top of the base budget, the One Big Beautiful Bill Act appropriated roughly $150 billion for Defense and $191 billion for Homeland Security across fiscal 2025–2029. Cutting people does not cut the workload those people were carrying. It moves it.
Where the work moves is the interesting part. By early 2026 the retrenchment had already reversed in places: agencies were posting record job openings — over 104,000 on USAJobs, up from under 69,000 months earlier — and reporting from the period noted that agencies would lean on contractors to fill the space vacated by departed staff. That is not a uniform expansion; it is a reallocation. Mission-critical functions that lost institutional knowledge — cybersecurity, accreditation, systems modernization, program and acquisition support — are exactly where agencies turn to contractor support to keep operating.
Here is the timing case. Much of fiscal 2026 opened under a continuing resolution after the October 2025 shutdown, with major appropriations — Defense and Homeland Security among them — still moving through Congress into the winter. And the big OBBBA money had barely been released: reporting indicated solicitations would be delayed well into the spring, with most of those funds not available before the second half of fiscal 2026.
Delayed funding does not vanish. It queues. When appropriations settle and OMB apportions the OBBBA dollars, the backlog of new-start programs that could not be solicited under the CR gets released at once. Our expectation: an unusually heavy run of RFPs from fall and winter 2026 into 2027, concentrated in defense, homeland security, and modernization. The fiscal-year mechanics that already push work into the year-end window (see our procurement-calendar piece) will amplify it.
Underneath the budget noise, the government is reorganizing how it buys. A March 2025 executive order made GSA the primary buyer for common goods and services and aimed to roughly quadruple its procurement role; a July 2025 OMB memo pushed agencies to consolidate buying further. Best-in-Class governmentwide vehicles are moving under GSA, some agency vehicles have been canceled outright (DHS dropped PACTS III and FirstSource III), and spend is being steered toward a smaller set of consolidated vehicles like OASIS+ and the major GWACs.
Why consolidate now? Our read is that it is partly a workforce story. The federal contracting workforce — the 1102 series — has been aging and thin for years (a majority within reach of retirement, very few under 30), and 2025 thinned it further. When you have fewer contracting officers, you cannot run more small, bespoke competitions; you route more dollars through fewer expert buying shops and pre-competed vehicles. Consolidation lets a smaller acquisition workforce move a larger, delayed pile of money. That is the mechanism we think is really at work — not just efficiency rhetoric, but a response to who is left to sign the awards.
If we are right, the winners will be the teams that are already on the consolidated vehicles, already visible during pre-solicitation, and already staffed in the mission areas agencies can no longer cover in-house. That is the posture we build for: presence on the vehicles the government is steering toward, a standing bench in cybersecurity, accredited delivery, and modernization, and the readiness to move fast when a delayed pipeline finally opens.
A note on this piece: the figures above are documented and sourced, but the outlook — the size and timing of the RFP wave — is our informed analysis, not a certainty. Appropriations, litigation, and policy can move it. We will update our read as the picture develops.
Whether you are a prime building a bench or a program planning capture, tell us where you are aiming and we will give you a straight read.
Talk to AusperThis site uses essential browser storage only. With your OK, we’d also use analytics cookies to understand which content is useful. No choice is required — “Essential only” changes nothing. Cookie policy