Information Technology (IT) modernization in the federal government has been on the rise for several years, and there's no slowing down in sight. It's safe to say that IT modernization has become a top priority in federal procurement. So why take a closer look at the top IT-North American Industry Classification (NAICS) Codes through the GSA Schedule?
NAICS Codes can provide valuable insight into government spending. As a current or prospective GSA Schedule contractor, one factor driving your government sales and marketing success is the ability to find great opportunities. Knowing what your NAICS Codes are, how they rank, and what the trends are is the first step in figuring out how you fit into the government space, and seeing if there are opportunities you are missing or not capitalizing on. Given that IT is a booming industry, we decided to follow the top 5 IT NAICS Codes through the GSA Multiple Award Schedule (MAS) Program and report how they are performing in federal procurement.
Before we launch into the top IT NAICS Codes, it's important to understand what NAICS Codes are and their significance for government contractors. North American Industry Classification Codes, or NAICS Codes, are reference numbers used to classify the core offerings and industry of a business. Government agencies use NAICS codes to collect, analyze, and publish statistical data on the U.S. business economy.
NAICS Codes put your business into categories that government agencies use to fulfill their procurement needs. In other words, NAICS Codes can help you find relevant contracting opportunities. NAICS Codes also help determine whether your company is considered a small business and can therefore reap the benefits of small business set-aside contracts.
It's important to note that the NAICS Code system is self-assigning, so you want to make sure you pick the most relevant code for your business. Under the recent Multiple Award Schedule (MAS) Consolidation, NAICS Codes and Special Item Numbers (SINs) which directly correlate to GSA Schedules, now have a very similar numbering system. In covering the top 5 IT-related NAICS Codes, we hope that you can better understand the IT industry in federal contracting and if your company is going after the right NAICS Codes and their corresponding opportunities.
Using GSA's Schedule Sales Query +, we created a table highlighting the top IT-related NAICS Codes for Fiscal Years 2021, 2022, and 2023 and the total dollar amount spent through the GSA MAS program. Since FY 2024 is still in full swing, the totals would not be accurate yet, so we chose to stick to the past 3 years because they had full reports. The top 5 IT NAICS Codes were in the same order for both years, and we used the government Fiscal Year timeline--October 1 to September 30.
|
NAICS Code |
2021 |
2022 |
2023 |
|
541519 - Other Computer Related Services |
$7,743,915,887 |
$8,172,150,108 |
$7,571,454,423 |
|
541511 - Custom Computer Programming Services |
$4,477,547,597 |
$5,093,642,352 |
$5,849,375,025 |
|
511210 - Software Publishers (used to be 511210) |
$3,156,834,170 |
$3,496,380,899 |
$4,902,456,914 |
|
541512 - Computer Systems Designs Services |
$1,955,965,502 |
$2,180,507,284 |
$2,618,489,078 |
|
334111 - Electronic Computer Manufacturing |
$839,753,061 |
$715,246,727 |
$956,137,483 |
As you can see, while these NAICS Codes have remained in the same order, they have generally grown steadily with the exception of 541519 in the last year and 334111 in 2022.
Four out of the five top IT NAICS Codes were also the top NAICS Codes over all the industries. That means that government agencies are spending more money on IT products total more than anything through the GSA Schedules program. If you want to learn more about each NAICS Code and how they fit into government procurement system, you can visit naics.com.
Let’s break down these 5 NAICS codes a bit further. We looked at the top 3 government agencies doing business with these NAICS Codes from 2021-2023. If your company is listed under one of these NAICS Codes or you are looking to add one in the future, you'll want to keep a close eye on these agencies. We used USAspending.gov to find this information.
| Top Agencies |
|
541519 - Other Computer Related Services |
|
DOD - Department of Defense |
|
VA - Department of Veterans Affairs |
|
DHS - Department of Homeland Security |
|
541511 - Custom Computer Programming Services |
|
DOD - Department of Defense |
|
HHS - Department of Health and Human Services |
|
DHS - Department of Homeland Security |
|
511210 - Software Publishers |
|
DOD - Department of Defense |
|
HHS - Department of Health and Human Services |
|
GSA - General Services Administration |
|
541512 - Computer Systems Designs Services |
|
DOD - Department of Defense |
|
GSA - General Services Administration |
|
HHS - Department of Health and Human Services |
|
334111 - Electronic Computer Manufacturing |
|
DOD - Department of Defense |
|
VA - Department of Veterans Affairs |
|
HHS - Department of Health and Human Services |
We hope it's clear now that NAICS Codes play an integral role in your GSA Schedule. It's important you choose the right NAICS Code, and understand how it can be used to determine business size standards as well as identify relevant contracting opportunities.
If you want to learn more about NAICS Codes and opportunities, check out our blog, "NAICS Codes--What Do they Mean for Your Business?" and if you want to learn more about finding contracting opportunities, check out our blog, "How to Identify Target Customers: Maximizing Opportunities with Your GSA Schedule." Of course, one of our consultants is here to help if you have questions about your GSA Schedule or finding the right NAICS Code for your business.