The Trump administration’s ongoing initiative to cut federal spending on consulting services is significantly impacting some of the largest firms in the industry.
Deloitte, a member of the prestigious Big Four accounting and consulting firms, is feeling the sting more than any other company, according to a recent analysis by Business Insider of government data.
Since January, Deloitte has seen at least 127 of its government contracts cut or modified, more than double the number of contracts affected at any other firm. These cuts are part of the administration’s push to reduce waste and improve efficiency in federal spending. The total savings from these reductions are estimated at $371.8 million, according to data from DOGE (the federal procurement database).
The cuts include significant reductions to a contract providing IT services to the Centers for Disease Control and Prevention (CDC), which alone saves taxpayers $51.4 million, and a $1.1 million saving from a Diversity, Equity, Inclusion, and Accessibility (DEIA) training contract that has been in place since 2020.
As a result of the federal budget changes, Deloitte’s contracts with federal agencies, which had been worth $3.3 billion annually, represented nearly 10% of the firm’s total revenue. This substantial reduction is a blow to the firm’s bottom line, with experts speculating that the cuts will impact their future growth in the public sector.
Booz Allen Hamilton, another major consulting firm, has also been significantly affected by the crackdown, with 61 contracts cut and savings totaling $207.1 million. In comparison, Accenture has seen 30 contracts cut, resulting in $240.2 million in savings. Despite these losses, Booz Allen Hamilton, which generates nearly all of its $11 billion annual revenue from public sector contracts, has been proactive in proposing further cuts and cost-saving strategies to the General Services Administration (GSA).
These three firms—Deloitte, Booz Allen, and Accenture—are part of a group of 10 major consulting companies under the GSA’s scrutiny, which collectively represent more than $65 billion in consulting fees over the next several years. The GSA, which leads the federal government’s procurement efforts, is demanding that these firms submit detailed breakdowns of their pricing structures and identify where additional savings can be made. Some firms have already suggested billions in potential savings, with proposals ranging from reducing the scope of current contracts to shifting towards performance-based pricing.
The Trump administration’s goal with this initiative is clear: cut waste, streamline government functions, and encourage a more outcome-focused approach rather than relying on open-ended, costly contracts. The push has already had a noticeable impact on the stock prices of consulting giants like Booz Allen and Accenture, with shares dropping significantly in the wake of the administration’s cost-cutting measures.
With input from Business Insider and the Wall Street Journal.
