Biden-Harris Administration Awards Record-Breaking $154.2 Billion in Contracting to Small Businesses
Highlights: One Million Small Business Jobs Created, Small Disadvantaged Business Goal Achieved a Year Ahead of Schedule
WASHINGTON –Today, Administrator Isabella Casillas Guzman, head of the U.S. Small Business Administration (SBA) and the voice for America’s 33 million small businesses in President Biden’s Cabinet, announced that the Biden-Harris Administration exceeded its small business federal contracting goal, awarding 27.2 percent or $154.2 billion in federal contract dollars to small businesses, an $8 billion increase from the previous fiscal year. The share of contracts going to small businesses equates to 27.2 percent of total federal contracting funds. Combined with $72 billion in subprime contracting goals, this historic spend has supported over one million jobs in the American economy.
Overall, the federal government exceeded its goal of 23 percent in prime contract dollars and earned an “A” on this year’s government-wide Scorecard. Eleven federal agencies earned an “A+” for their agencies’ achievements in small business contracting, and an additional ten agencies received an “A” grade. SBA sets contracting goals for each agency and works with government buyers to ensure that they prioritize small businesses.
“The Biden-Harris Administration set historic records in small business contracting, including the highest percentage spend to Small Disadvantaged Businesses and growth for our Service-disabled Veteran Small Businesses, which has advanced competition, strengthened local economies, and supported job growth across the nation,” said Administrator Guzman. “By expanding small business opportunities and building equity in federal procurement, we have helped to ensure that federal agencies can fully leverage the extraordinary talent and innovation delivered by our nation’s entrepreneurs. Building on the major procurement reforms announced last year; the SBA will continue to further progress in all federal procurement goals so more entrepreneurs can grow their businesses with government contracts, including those presented by President Biden’s Infrastructure Investment and Jobs Act.”
“Small businesses know how to get the job done, and they have a key role to play in delivering the generational infrastructure investment underway through the Bipartisan Infrastructure Law,” said U.S. Transportation Secretary Pete Buttigieg. “We know that it hasn’t been easy for small businesses – particularly those owned by women and people of color – to reap the benefits of past infrastructure investments, and we’re proud of the actions this Administration is taking to level the playing field, remove barriers to opportunities, and increase access to wealth creation for small businesses across America.”
“The Department of Homeland Security (DHS) is honored to receive an A+ for the sixth year in a row – the largest federal agency to have such a record – for the accomplishments of our acquisition professionals in maximizing opportunities for small businesses,” said Homeland Secretary Alejandro N. Mayorkas. “Last year alone, DHS obligated $8 billion to American small businesses working to support the homeland security mission. DHS will continue to lead in small business contracting by focusing on small business outreach and engagement as we support diversity, equity, and inclusion.”
“At NASA, we work to explore the secrets of the universe for the benefit of all, and a big part of that is how we improve life on Earth through innovation – including technology, medicine, and access to space,” said NASA Administrator Bill Nelson. “Our relationships with small businesses help NASA stay on the cutting edge of innovation while allowing us to achieve our small business prime contracting goal to make investments in this country’s future. We will continue to work to identify the barriers to access for small businesses and find ways to create more favorable, equitable procurement practices to help establish the future of space exploration, scientific discovery, and aeronautics research.”
“Small businesses play a vital role in the American economy, and they are essential to the mission of the Department of Defense (DoD), enabling us to develop, deliver and sustain critical capabilities to our Warfighter. DoD achieved our small business prime contracting goal for eight consecutive years. This shows our commitment to maximize opportunities for small businesses, which increases competition and strengthens our national and economic security,” said DOD Undersecretary William LaPlante.
The individual agency scorecards were released today, and a detailed explanation of the methodology is available at SBA.gov. Highlights include:
- Small Disadvantaged Business (SDB) spending reached 11.0 percent for the first time in history. This achieves the President’s committed increase to SDB contracting one year ahead of schedule.
- Service-disabled Veteran-owned small business spending reached 4.4 percent out of a three percent goal, which represents $25 billion in procurement and an important $1 billion spending increase over the prior year.
- Historically Underutilized Business Zone (HUBZone) small businesses received a historic $14.3 billion in federal contract awards; although the federal government has never met the 3-percent statutory goal, it reached the highest amount awarded to HUBZone businesses in the program’s history.
- Women-owned Small Businesses (WOSB) received more than $26 billion for the third straight year, translating to 4.6 percent of the FY21 total eligible dollars. The SBA is actively working with contracting agencies to make future progress toward achieving the WOSB goal. For instance, SBA has increased the number of certified firms from approximately 1,000 to nearly 6,000 and expanded the NAICS codes for which women-owned businesses can receive set-aside awards. Now over 92 percent of federal spending is covered by NAICS codes eligible for WOSB set-aside awards.
- The federal government achieved its small business subcontracting goals, awarding 30.9 percent, or $72 billion, to small-business subcontractors. Women-owned Small Business subcontractors received 5.2% of subcontracts, or $12.2 billion, exceeding the 5 percent WOSB subcontracting goal.
- Despite the overall increase in the dollar value of small-business awards, the absolute number of small businesses receiving prime contracts with the federal government decreased again in FY21. This continues a multi-year trend of decreases in small-business vendors, dating back over a decade. In December, the government issued a policy memorandum intended to reverse the decline in the small-business supplier base, in part by tracking new entrants to ensure that new government contractors are entering and then finding opportunities in the federal marketplace.
*The prime contract goal achievements by dollars and percentages for all categories are as follows:
Small Disadvantaged Business
Service-Disabled Veteran-Owned Small Business
Women-Owned Small Business
1. FY 2019-21, in accordance with federal law, SBA provided double credit, for Scorecard purposes only, for prime contract awards in disaster areas that were awarded as a local area set aside and a small business or other socio-economic set aside when the vendor state is the same as the place of performance (15 USC § 644(f)), and for awards to small businesses in Puerto Rico or covered territories (15 USC § 644(x)(1)). SBA also included in the calculation of FY19-21 government-wide achievements the Department of Energy first-tier subcontracts required to be included by section 318 of the Consolidated Appropriations Act of 2014 (“CAA”), Public Law 113-76.
The SBA continues to collaborate with federal agencies to expand small business opportunities for small business contractors to compete and win federal contracts. The FY2021 Scorecard analyzed the prime contracting and subcontracting performance and other contributing factors, which resulted in an overall “A” grade for the federal government.
Small Business Federal Procurement Scorecard Overview:
The annual Procurement Scorecard is an assessment tool to measure how well federal agencies reach their small business and socio-economic prime contracting and subcontracting goals. The Scorecard also provides accurate and transparent contracting data and reports agency-specific progress. The prime and subcontracting component goals include goals for small businesses, WOSBs, SDBs, service-disabled veteran-owned small businesses, and small businesses located in HUBZones.
Every year, the SBA works with agencies to set their individual prime and subcontracting goals. The SBA ensures that, in the aggregate, the federal government meets or exceeds the government-wide statutory goals mandated in 15(g)(1) of the Small Business Act in each category. While each federal agency ensures the quality of its own contracting data, SBA conducts additional analyses to help identify potential data anomalies and with federal agency procurement staff to provide analysis and tools to facilitate a review of data, implement improvements to procurement systems, and conduct training to improve accuracy.