The last few years of increases to the Defense budget have been, in general, good news for contractors. But it’s an uneven picture.
In particular, Pentagon spending on research and development still hasn’t recovered from the cuts imposed by the 2011 Budget Control Act even as spending on products and services has risen significantly.
Those findings are part of the latest annual analysis of DoD contract spending data by the Center for Strategic and International Studies.
Overall, CSIS found contract spending has risen 35% since 2015, the low point of the Defense drawdown. That figure includes a 4% increase between 2018 and 2019.
But when it comes to R&D spending, the recovery has been much, much slower. In 2019, the department spent about $30 billion on R&D contracts. That’s well below what it spent in 2012, and even adjusting for inflation, about the same as pre-9/11 level spending.