Kristen Smith
Deltek’s latest study on the government contracting industry identified the rising compliance costs related to the updated Cybersecurity Maturity Model Certification requirements as one of the challenges facing contractors in 2025.
Half of the government contractors surveyed anticipate increased CMMC compliance costs, with enterprise firms having invested $100,000 or more on necessary upgrades and tools, Deltek said Monday, noting that the Department of Defense estimates the costs of achieving CMMC Level 2 certification to reach the same amount for small businesses.
Barriers to Participating in Small Business Contracting Program
The 16th annual Deltek Clarity Government Contracting Industry Study found that small business contractors are facing slower growth than in 2024, limited access to federal resources, and the greatest difficulties in adopting new technologies like artificial intelligence and managing rising labor and compliance costs.
Nearly half of the small business respondents indicated they are not taking advantage of federal support programs such as 8(a), which could help ease growth barriers. According to Deltek, the costs of compliance with 8(a) program requirements and the competitive environment present a barrier to taking full advantage of the small-business-centric program.
Data also showed that the government contractor confidence index fell by 3.5 percent, hitting its lowest point in six years. According to Deltek, the drop signals increasing caution around federal spending and growth prospects for contractors.
“Contractors are navigating a complex and rapidly changing environment, but they also have more opportunities than ever to innovate and grow,” said Kevin Plexico, senior vice president of information solutions at Deltek and a six-time Wash100 recipient. “This year’s Clarity report highlights how top-performing firms embrace emerging technologies like AI, strengthen compliance postures, and refine business development strategies to capture new opportunities while managing risks and costs. Success today requires not just resilience, but proactive, data-driven decision-making across all areas of the business.”
