Small biz buys rose to $132.9B in FY2019; WOSB 5% goal met

      Federal contract spending has seen rapid growth in the last three years, but the number of small business primes in the federal market has been falling during the same period.

      While total federal contract spending expanded by 25% from fiscal 2016-2019, the number of small business prime contractors dropped by 14.7% during that three-year period, according to Set-Aside Alert’s analysis of data from USASpending.gov and the Small Business Administration.

      Total federal contract spending ballooned to $578 billion, from $464 billion, during the three years.

      While that was happening, the number of small vendors in the federal market fell from 120,009 firms in 2016, down to 102,422 firms in 2019.

      The downward trend in numbers has not gotten much attention, possibly because the SBA has highlighted the increase in the value of small business contract awards during the three years, from $100 billion in fiscal 2016 to $133 billion in fiscal 2019.

      Obviously, some small businesses are succeeding in the federal market. But overall, more small firms left the market in the last three years than entered it, resulting in a net loss of small prime vendors.

      Concerns about small firms withdrawing from the federal market have been raised for several years, and the SBA began regularly collecting numbers on the trend starting in fiscal 2016.

Trends in each category

      For all small business primes, there was a 14.7% decrease in numbers overall:

• 120,009 in 2016;
• 119,336 in 2017;
• 113,135 in 2018; and
• 102,422 in 2019.

      For women-owned small primes, the net loss was steepest at 17%:

• 26,612 in 2016;
• 26,497 in 2017;
• 24,483 in 2018; and
• 22,023 in 2019.

      For small disadvantaged primes, there was a net gain of 0.8% more firms over the three-year period:

• 36,821 in 2016;
• 38,432 in 2017;
• 38,877 in 2018; and
• 37,149 in 2019.

      Service-disabled veteran-owned primes experienced a net gain of 6%:

• 11,334 in 2016;
• 12,231 in 2017;
• 12,649 in 2018; and
• 12,032 in 2019.

      For HUBZone small primes, there was a net increase of 12% more firms in that category over the three years:

• 5,962 in 2016;
• 6,318 in 2017;
• 6,621 in 2018; and
• 6,676 in 2019.

More information:
SBA data: https://bit.ly/3jrnmvo
USASpending.gov:Click here

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