US SBA small business size standard proposals

The U.S. Small Business Administration (SBA) has proposed a major restructuring of federal small business size standards. The initiative seeks to simplify the current system by applying standards at broader 4- and 5-digit NAICS levels, which would reduce the number of separate standards from nearly 1,000 down to 338.

To account for inflation and economic shifts, the SBA intends to raise revenue thresholds for various sectors. For example, computer systems design services could see a threshold increase from $34 million to $531 million. The agency estimates these adjustments would allow approximately 114,541 additional businesses to qualify for SBA-backed lending, counseling, and government contracts. The proposal also includes moving toward employee-based measurements in certain instances to mitigate the impact of revenue volatility.

The proposal has generated significant feedback, with over 66,000 comments submitted via the Federal Register. While some industry groups, such as the Brewers Association, have stated they do not expect the changes to “materially change” the competitive landscape for their specific members, other critics argue the new standards could force small businesses to compete directly against mid-sized firms. The public comment period is scheduled to close on September 21, 2026.