Federal contracting could look very different within a decade, according to Margarita Howard, sole owner, CEO, and president of HX5. Her prediction centers on artificial intelligence and how agencies buy services.

“We believe that in the years to come, and certainly by 2035, government agencies will increasingly utilize AI to streamline procurement processes, evaluate contractor performance, and probably predict future needs based on historical data that they collect,” Howard said.

Preparing a Contractor for Change

HX5, a service-disabled veteran and women-owned company in Florida, supplies STEM support services to NASA and the Department of Defense. With more than 1,000 employees across 34 states, the firm depends on winning and keeping federal contracts. If agencies begin using AI to judge contractor performance and anticipate needs, firms like HX5 will need to understand those systems well.

Howard has prepared for that shift by adopting AI internally. “We try to stay ahead of changing technologies, AI, and cybersecurity,” she said. The company uses AI in proposal development, which she calls an absolute necessity in government work, and in organizing the detailed documentation that federal audits require.

The Workforce Angle

Technology also figures into hiring. Generation Z, which Johns Hopkins University research expects to make up around 30% of the workforce by 2030, tends to expect up-to-date tools. Defense contractors already compete with commercial tech companies that often pay more and hire faster, and outdated systems could widen that gap. The talent pool is already thin. National Defense Magazine reported that 82% of defense industrial base companies have difficulty finding qualified STEM workers.

Margarita Howard has responded with hybrid work where security permits and modern platforms like instant messaging. She still prefers candidates with experience supporting NASA or Defense Department programs. Some HX5 employees have stayed for 15 years, a sign that the company keeps talent once it lands it.

Her forecast points to a future where both contractors and agencies lean heavily on data. HX5 appears intent on being ready when that future arrives. Read this article for additional information.

Find more information about Howard on https://www.youngupstarts.com/2025/01/10/how-hx5-and-margarita-howard-stay-ahead-in-government-contracting-as-a-women-owned-firm/