The 5 Hottest SLED Markets for Government Contractors Right Now

The state, local, and education (SLED) market is booming, and if you’re a government contractor looking to diversify beyond federal work, now is the time to expand.

With billions in state budgets flowing into infrastructure, technology, healthcare, and sustainability projects, some states offer prime opportunities for businesses ready to strategically position themselves.

So where should you be looking? I’ve broken down the five hottest SLED markets across the country… covering every region so you can find the right fit for your business.

California: The SLED Powerhouse with a $300B+ Budget

California’s state + local market is basically the Beyoncé of government contracting. It’s massive, influential, and everyone wants in. With the largest economy in the U.S. and a state budget bigger than most countries, California leads the nation in public spending and government contracts.

Where California Is Investing Big:

🚧 Infrastructure + Transportation: Billions are flowing into highways, bridges, rail systems, and public transit upgrades. If you’re in AEC, engineering, or transportation tech, this is your market.

🌱 Green Energy + Sustainability: California is a leader in renewable energy, EV infrastructure, and climate tech. Solar, wind, and sustainability-focused contractors are in high demand.

💻 Tech + Innovation: With Silicon Valley and a state-funded push for digital transformation, there’s a constant need for cybersecurity, IT services, and AI-driven government solutions.

🏥 Healthcare + Public Services: California’s public health programs, emergency response efforts, and housing initiatives mean huge contracts for those in healthcare, human services, and community support programs.

Keys to Winning in California:

✅ Register with Cal eProcure: The state’s main procurement portal.

✅ Understand local preferences: Some agencies prioritize CA-based vendors.

✅ Be ready for fast-moving RFPs: Many opportunities move faster than federal.

‍

Virginia: The SLED Market with Federal Crossover Potential

Virginia is like the cool older sibling of federal contracting – close enough to DC to have strong government ties, but independent enough to do its own thing. With a booming tech sector, a defense-heavy economy, and billions in state funding, Virginia is a prime target for contractors looking to expand beyond federal work.

Where Virginia Is Investing Big:

🛡️ Cyber + IT Contracts: Virginia leads the nation in cybersecurity spending and is home to the country’s largest data center hub. AI, cybersecurity, and digital services contractors are in high demand.

🚧 Transportation + Infrastructure: Billions in state funding are flowing into highway expansions, public transit projects, and smart infrastructure.

🏛️ State + Local Government Services: From education to workforce development, Virginia spends big on consulting, training, and professional services.

🚀 Defense + GovTech: With major military bases and federal agencies, Virginia offers crossover potential for contractors used to working with the federal government.

Keys to Winning in Virginia:

✅ Register on eVA: The state’s procurement portal.

✅ Leverage SWaM Certification: Virginia prioritizes Small, Women-owned, and Minority businesses.

✅ Track regional + municipal opportunities: NOVA, Richmond, and Hampton Roads have separate procurement entities.

‍

New York: The SLED Market with Major Infrastructure + Tech Investments

New York’s SLED market is like Times Square: big, fast-moving, and full of opportunities if you know where to look. With a $230B+ budget and billions pouring into infrastructure, cybersecurity, and housing, there’s no shortage of contracts. But you better be ready to compete.

Where New York Is Investing Big:

🚇 Infrastructure + Transit: The MTA has a $51B capital plan, making it one of the largest transportation procurement entities in the U.S.

🔐 Cybersecurity + IT Modernization: With heavy investments in smart cities, digital services, and data security, there are huge opportunities for IT and cyber firms.

🏢 Affordable Housing + Urban Development: Aggressive targets for affordable housing and mixed-use developments create major opportunities for AEC firms and developers.

🏥 Healthcare + Public Safety: New York invests heavily in Medicaid, mental health services, and telehealth initiatives.

Keys to Winning in New York:

✅ Get on NYS Contract Reporter: The main state procurement hub.

✅ Check MWBE + local vendor preferences: Many contracts favor NY-based or MWBE-certified businesses.

✅ Know the agencies: MTA, NYCHA, NYSDOT, and NYC agencies have massive contract volumes.

‍

North Carolina: The High-Growth R+D and Healthcare Market

With a fast-growing economy, a booming life sciences sector, and one of the strongest public health programs in the South, North Carolina is an emerging SLED powerhouse. And my hometown. 😊 Go Duke!

Where North Carolina Is Investing Big:

🧬 Biotech + Life Sciences: Home to The Research Triangle, North Carolina is a top state for medical + pharmaceutical R&D.

🛩️ Defense + Aerospace: With major military bases and state-backed defense initiatives, North Carolina is a prime target for defense contractors.

🏥 Healthcare + Public Health: Expanding Medicaid, behavioral health programs, and telehealth adoption create huge opportunities for health-focused contractors.

Keys to Winning in North Carolina:

✅ Register on NC eProcurement.

✅ Monitor Research Triangle Park (RTP) initiatives.

✅ Track military-related contracts tied to state funding.

‍

Illinois: The Midwest’s Infrastructure + Transit Giant

If you’re looking for a SLED market with big-city spending but Midwestern practicality, Illinois is your spot. With a $140B+ state budget and massive investments in transit, infrastructure, and digital transformation, this market is as steady as a Chicago deep dish pizza. It takes time to win here, but when you do, it’s worth it.

Where Illinois Is Investing Big:

🚧 Infrastructure + Transportation: Billions in funding for road, rail, and airport upgrades via IDOT.

🏥 Healthcare + Social Services: One of the largest Medicaid budgets in the country, plus major investments in public health and human services.

🤖 Smart Cities + AI: Chicago’s smart city initiatives and state-backed AI innovation are expanding rapidly.

Keys to Winning in Illinois:

✅ Register on Illinois Procurement Gateway (IPG).

✅ Target IDOT and CTA contracts for transportation work.

✅ Track AI + digital transformation initiatives.

SLED Procurement Can Feel Like a Maze. Here’s How to Navigate It

Winning in SLED isn’t just about knowing where the money is… it’s about knowing where to look.

Unlike federal contracting, where SAM.gov is the central hub, SLED procurement is scattered across state, county, city, and municipal portals. Some local agencies use the state’s procurement system, many don’t. That means:

❌ Registering on multiple procurement sites just to access opportunities

❌ Manually tracking bid postings across different platforms

❌ Spending more time searching for opportunities than bidding on them

Here’s the good news: You don’t have to do it the hard way.

We use a great aggregator tool that pulls everything into one source of truth so you can see all relevant SLED opportunities in one place.

Want an introduction? We don’t get referral fees… we just know this tool makes life easier, and we’re happy to connect you.

Reach out, and we’ll set it up.

‍

Where Should You Focus Next?

Each of these top SLED markets offers massive opportunities… but success requires the right positioning, relationships, and strategy.

Need help navigating SLED contracts? Summit Strategy has helped contractors break into these markets, win competitive bids, and position themselves for long-term success.

📩 Let’s talk strategy.

‍