The U.S. Small Business Administration (“SBA”) has proposed a rule that would reshape how the federal government defines a “small business” across 338 industry groups and industries, dramatically increasing the number and size (by average annual revenue or number of employees) of companies that would qualify as small businesses for government contracts and SBA purposes. The proposed changes touch nearly every sector of the economy—from agriculture and manufacturing to construction, IT, and professional services—and carry significant implications for government contractors, subcontractors, and any business that relies on SBA-backed programs by significantly increasing size standards for hundreds of thousands of businesses.
The chart below provides a few examples of the significant changes in size standards:
| NAICS | Description | Current Size Standard | Proposed Size Standard |
|---|---|---|---|
| 541330 | Engineering Services | $25.5 million | $252 million |
| 541519 | Other Computer Related Services | $34 million | $531 million |
| 541618 | Other Management Consulting Services | $19 million | $295 million |
| 561210 | Facilities Support Services | $47 million | $156 million |
| 336412 | Manufacturing Guided Missile and Space | 1,250 employees | 2,800 employees |
| 336611 | Ship Building and Repairing | 1,300 employees | 2,300 employees |