Executives at government contracting firms typically assume that state, local and education buyers are reliant on federal policies and money.
When they hear bad news about the federal government, they figure these problems are also cascading down to lower levels.
But that’s a serious misconception. In fact, the state and local market is driven by its own demographic, economic, policy and technology factors.
Because state and local governments provide a variety of direct services, population growth and demographic changes can alter their missions.
The number of young and oldis set to grow, leaving fewer working-age people to pay for education and health care. These trends are likely to drive efforts to augment school classrooms with technology and use business intelligence to rein in Medicaid costs.
Financial events can also drive buyer responses. The recent recession, for instance, ushered millions of Americans into unemployment offices and into two- and four-year colleges.