Deloitte Faces Major Cuts as Trump Administration Targets Consulting Contracts

WASHINGTON, D.C. – The Trump administration’s ongoing crackdown on government consulting firms has significantly affected major players in the industry, particularly Deloitte. Since January, at least 127 of Deloitte’s government contracts have been cut or modified, according to a Business Insider analysis.

This number is nearly double that of the next hardest-hit firm, which underscores the administration’s heightened scrutiny amidst a broader initiative aimed at cutting waste and increasing efficiency.

A total of 10 major consulting firms have been affected, including Booz Allen Hamilton, IBM, and General Dynamics. The Department of Government Efficiency (DOGE) estimates that the cuts to Deloitte will save taxpayers approximately $371.8 million. Notably, these savings include $51.4 million from a contract for IT services with the Centers for Disease Control and Prevention and $1.1 million from a contract focused on diversity, equity, inclusion, and accessibility training.

According to Deloitte’s recent earnings report, contracts with federal agencies accounted for $3.3 billion annually, nearly 10% of the company’s total revenues. Booz Allen Hamilton, heavily reliant on public sector contracts, has also seen significant impacts, with 61 contracts cut, leading to a projected $240.2 million in savings.

During a recent earnings call, executives expressed concern over the financial impact of DOGE’s cost-cutting measures, hinting at potential layoffs. CGI Federal and Leidos have not provided comments regarding these changes but have indicated they will continue discussions with the administration.

The General Services Administration (GSA), the government’s largest procurement entity, is spearheading the review of federal consulting expenditures. The GSA indicated that consulting contracts with the 10 listed firms could generate over $65 billion in fees through 2025 and beyond.

In March, the GSA requested these consultancies submit detailed pricing breakdowns and proposals for cost reductions. They were also instructed to clearly identify “mission critical” contracts and simplify their explanations to ensure that even a teenager could understand their services.

Responses to the GSA’s request were mandated by a recent deadline, and agency officials confirmed that reviews of submitted proposals are currently underway. The agency aims to further minimize waste and transition towards outcome-based contracts rather than open-ended agreements.

According to a source within the GSA, many CEOs and senior executives at the consulting firms seem to align with the administration’s cost-saving strategies and efficiency objectives, indicating a collaborative willingness to adapt.

The full list of contracts cut and the corresponding savings includes: Science Applications International Corp. with five contracts representing $7.5 million in cuts.

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