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Small Business Administration Proposes Increased Small Business Size Standards

Jul 25, 2012 5:10 PM

Standards Build Base for Government Contracting, Federal Assistance and Incentives


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The U.S. Small Business Administration (SBA) began an effort to review size standards for small businesses as required by the Small Business Jobs Act of 2010. Just last week, the SBA released its proposed standards for NAICS Sector 23 (North American Industry Classification System), the construction industry. A formal review of the size standards had not been conducted since the 1970s and early 1980s.

Small business size standards are significant for those contractors looking to bid on federally funded projects, apply for federal business assistance, and in some cases, incentives are offered for small businesses of specific NAICS sectors. These size standards are based on two primary business measures – average annual receipts and average number of employees.

Most NSCA members are classified under 238210 – Electrical Contractors and Other Wiring Installation Contractors. A few contractors dealing specifically with the sell, installation and monitoring of security systems might also use 561621. The proposed changes do not increase the size standards for 238210, which currently stand at $14.0 million dollars in average annual receipts. There is some concern that with any of the proposed changes (specifically the Land Subdivision (NAICS 237210) and Other Heavy and Civil Engineering Construction (NAICS 237900) would increase the competition on bidding for federally funded projects, which could in-turn effect sub-contracting capabilities due to more competition at the general contractor level.

Due to demand by the marketplace – the SBA initiated this review due to economical changes and the effects on federal contracts. Review the Federal Register notice for more information on the proposed changes and for more information size standards in general visit www.sba.gov/size.



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