Small Business Contracting Goals: What Changed Under the Trump Administration?

Written By MN Motorsports .

By Government Contract Consultants LLC

Federal contracting has always been shaped by shifting administrations, priorities, and executive orders. Recently, dramatic changes have impacted how small business contracting goals are set — especially for firms in programs like 8(a), WOSB, SDVOSB, and HUBZone.

In a recent conversation, Stephanie Ellis, attorney at Koprince McCall Pottroff, explained the major adjustments and what they mean for small businesses moving forward.

From Expansion to Retrenchment: The Policy Shift

Under President Biden, small business contracting goals were expanded. His administration sought to increase federal spending with socially and economically disadvantaged small businesses, aiming to grow 8(a) and Small Disadvantaged Business (SDB) participation from the statutory 5% goal up to 15% by 2025.

However, with the transition to the Trump administration, Executive Order 14151 — Ending Radical and Wasteful Government DEI Programs and Preferencing — reversed course. The order directed agencies to reduce or eliminate programs tied to diversity, equity, and inclusion, and to return contracting targets to their statutory minimums.

  • Small Disadvantaged Businesses (8a/SDBs): Reset to 5%

  • Service-Disabled Veteran-Owned Small Businesses (SDVOSBs): Now 5% (increased by law in 2024)

  • Women-Owned Small Businesses (WOSBs): 5%

  • HUBZone Businesses: 3%

While these programs still exist, the emphasis has shifted back toward general small business participation.

What This Means for 8(a) Firms

The biggest impact is being felt in the 8(a) program. Although the 5% contracting goal remains, funding directed to 8(a) participants is being scaled back. Agencies are now prioritizing the overall small business contracting goal of 23%, which amounted to about $183 billion in contracts in FY 2024.

Despite the change, Ellis noted that many firms still see tremendous value in the 8(a) program, though requirements for proving social and economic disadvantage are becoming stricter.

Silver Linings for Small Businesses

Not all the news is negative. Agencies across government remain eager to work with small businesses, often raising their overall small business goals even as specific socio-economic program targets are lowered.

As Ellis put it:

“A lot of the agencies seem to want to work with small businesses, which is great because those are the businesses that really make up kind of the fabric of our country.”

Where Are the Opportunities?

For small firms looking to break into federal contracting, Ellis pointed to several strategies:

  1. General Small Business Contracts
    Meeting size standards under the NAICS codes qualifies you as a small business — no certification required.

  2. Mentor-Protégé Program
    A strong option for newcomers. This SBA program pairs small businesses with larger firms, allowing them to jointly pursue contracts while the small business benefits from mentoring, past performance building, and direct federal opportunities.

  3. Subcontracting Pathways
    For firms not ready to prime contracts, subcontracting remains a reliable entry point into the federal marketplace.

Key Takeaways

  • Expect reduced emphasis on socio-economic set-asides like 8(a), but strong opportunities remain.

  • Overall small business spending targets are steady at 23% — and in some cases, higher.

  • Programs like SBA’s Mentor-Protégé offer practical ways for small businesses to grow experience and compete.

Final Word

While the policy pendulum has swung back to statutory minimums, small businesses still command a vital share of federal contracting. Success today will come from adapting strategies, leveraging mentorship, and positioning smartly in the evolving federal landscape.

MN Motorsports .