K12 and Higher Education Government Contracting Trends and Takeaways for 2021

March 29, 2021
Paul Irby
Paul Irby
Principal Research Analyst

The state, local and education (SLED) market finished out a difficult year in 2020 with improvement in the growth rate of competitive opportunities. Q4 bid and RFP issuance was down -13.3% year-over-year, improved from -15.8% in Q3 and -26% in Q2. This brought the entire 2020 year to a decline of -15.4%.

Still, there are bright spots on the horizon. One area that is expected to rebound in the coming years is that of education contracting, as we noted in our recent State and Local Procurement Snapshot – Q4 2020 report covering recent developments in the SLED government market. This free-to-download report examines 12 key industry segments and their performance over the last quarter.


State and Local Procurement Snapshot – Q4 2020

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Read on for more specific education contracting trends and takeaways from our expert analysts.

Understanding the K12 and Higher Education Government Contracting Market

Education government buys from each of the 12 industries. In this article, we have forecasted bids in K-12 and higher education government and provided analysis using our recent Education Contracting Analysis and 2021 SLED Forecast to briefly summarize the most relevant, useful insights for vendors and contractors.

GovWin’s database identifies independent K-12 school districts and public higher education (universities and community colleges) as unique levels of SLED government. This definition does not include large urban public school districts that are part of a city or county government structure.

Market Size and Forecast for K-12 Education Government Contracting

The number of advertised competitive bids and RFPs issued grew from around 44,000 in 2007 to around 53,900 by calendar year 2019. Due to the effects of the pandemic, 2020 bids and RFPs declined by -18.5%. Based on GovWin’s forecast for the entire SLED market of bids and RFPs, K-12 government bid volume is expected to grow by 13.0% in 2021 and then another 4.9% for 2022 as fiscal conditions normalize.

SLED K12 Education Pandemic Bid Forecast

Compared to the no-pandemic trend line, the K-12 market of independent districts is projected to be down by -17,487 total bids from 2020 to 2022. For comparison, the Great Recession impact during 2010-12 was similar in total bids lost.

Market Size and Forecast for Higher Education Government Contracting

Bids initially grew in the aftermath of the Great Recession as enrollment swelled from the lack of jobs, peaking in 2011 at around 40,000. Since then the trend has been down as state support for higher education has come under pressure, tuition costs have jumped and enrollment numbers have declined or stagnated. With the pandemic impact, 2020 bids declined by -21.2%.

SLED Higher Education Pandemic Bid Forecast

Higher education government is expected to grow by 15.3% in 2021 following the decline in 2020 – a slightly larger rebound versus for K-12 due to the lower starting point. 2021 should see another 4.8% increase. Compared to the no-pandemic trend line, the higher ed market is expected to be down by -12,430 total bids from 2020 to 2022.

Emerging Developments to Watch For in K-12 and Higher Education Government Contracting

K-12 is expected to see a priority shift to progress improvement measures as well as automation. However, districts are not equipped with the skilled resources in areas of artificial intelligence (AI) and machine learning (ML) that can help create tangible results of progress measurement. These areas will grow faster as K-12 will be in greater need for experts coming from all types of vendors, large and small, to help understand the achievement gaps that are inevitable in the face of the pandemic. In addition, as the outcome of statewide assessments are unknown, K-12 will need to provide data-driven insights to monitor student achievement. Finally, in an increasingly digital world, K-12 institutions will look to further develop STEM curriculum and their Career and Technical Education (CTE) programs.

In higher education, institutions will be looking to replicate the student experience in a virtual environment. As many face large enrollment declines, the market must respond with drastically new business models for delivering education but also for staff and administrators. Higher ed will need to deliver its vast amount of services in online formats. They will increasingly rely on workforce development in order to equip students with necessary skills and resources to enter the job force. Finally as higher ed continues its response to the pandemic, it will need to shift toward new programs in healthcare and STEM.

While some of these high priority purchases have remained strong in recent months, as the pandemic gets under control, temporary softness in demand for the full range of categories should begin to reverse – as the forecast numbers suggest. Vendors selling into education government should continue to watch for opportunities across all aspects of education, as this market involves a vast amount of services, supplies, systems, software, construction and maintenance.

Looking for more key takeaways, trends and SLED market developments from Q4 2020? Click the below link to download GovWin’s State and Local Procurement Snapshot to give yourself the best picture of where the market is headed. And you can browse the Market Analysis section of GovWin’s platform to find the timeliest analysis of both federal and SLED contracting.


State and Local Procurement Snapshot – Q4 2020

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