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ARTICLE · 01 SEPTEMBER 2026

For The SBA, "Small" Could Soon Mean Something Bigger

The U.S. Small Business Administration has proposed significant changes to small business size standards that could expand eligibility for approximately 114,000 additional companies. The proposed rule would streamline industry classifications, shift toward employee-based metrics, and substantially raise both receipts and employee thresholds across various sectors. These changes could reshape the landscape of federal contracting opportunities, potentially benefiting midsize businesses while intensifying comp

United StatesGovernment, Public Sector

The U.S. Small Business Administration (SBA) has proposed sweeping changes to how it defines small businesses, including higher size thresholds that would allow roughly 114,000 additional businesses to qualify as small.

Under its proposed rule, published Aug. 20 in the Federal Register, the SBA would reduce the number of industry classifications used for size standards from nearly 1,000 to 338, change several size standards from receipts-based to employee-based, and increase both the receipts-based and employee-based standards.

“Given the difficult conditions small businesses faced during 2021-2024, including high inflation and increased regulatory burdens, the SBA believes reductions would stifle the economic growth now underway,” the agency said.

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