Many have heard the word “Sequestration” bandied about in the press, but few seem to know what it means. It refers to budget cuts to federal spending that began on March 1, 2013 as an austerity fiscal policy enacted by the Budget Control Act of 2011. The spending reductions are approximately $85.4 billion during fiscal year 2013, with similar cuts for years 2014 through 2021.
Starting the week of July 8, 2013, many civilian federal workers will be forced to take one day a week off without pay through the end of September. This is essentially a unilateral 20 percent pay cut during that period. In the Department of Defense, the number of civilian workers furloughed is expected to be over 650,000. In the other departments, the full impact isn’t yet known but many are receiving furlough notices.
So how does this impact the government’s Big Data projects?
The government has a wealth of data that must be made available per executive order. In the spring of 2012, the Obama Administration initiated a vision for Big Data known as the Open Data initiative, which was valued at about $11 billion in 2012, according to Wikibon. To the Big Data community, this is a bonanza. Because of it, there’s been a surge in demand for those professionals with the right talent and skills. But now we have a question to face: Will sequestration have an impact on these Big Data opportunities? The answer’s “yes,” and the impact comes in in more ways than anyone had ever considered.
Consequences of Sequestration
For those Big Data contracts that have been won, contractors having to deal with federal workers are finding that their colleagues are distracted with news of coming furloughs and possible work force reductions. Many federal workers are starting to look to private industry for job opportunities, while others are trying to find part-time work to supplement their incomes. Bottom line, they’re distracted from their jobs and it’s beginning to have a negative impact – specifically, delays — to these Big Data projects.
For those Big Data contracts that are in the pre-proposal or proposal stage, there’s now an expectation of a delay or even cancellation. Even those contracts that survive are expected to be reduced in value. In addition, the processing of these contract proposals is being delayed because of furloughs and the distraction of Sequestration.
For those in the Big Data business who have or are chasing government business, all of this will most likely lead to adjustments in schedules, meaning not as many Big Data professionals will be needed for each project – at least not right now. For those of us who manage these efforts, it means that planning the schedules and personnel to support the projects will be more challenging. Not only do we have to consider the furlough days, but also the inherent inefficiencies that can be expected from a distracted federal work force.
While the Open Data initiative is still a boon to the Big Data community, many are privately concerned that Sequestration doesn’t turn it into a bust. Many Big Data businesses are doing the right thing and trying to diversify so they’re not relying as heavily on the government’s business.