BLUF: The Small Business Administration (SBA) proposed new size standards for 338 industry groups on August 20, 2026, a change it estimates would make roughly 37,002 additional firms eligible as small businesses.

SBA published the proposed rule in the Federal Register on August 20, 2026, revising small-business size standards for 338 industry groups and industries. The agency says the changes are designed to "better reflect the nature of the markets in which small businesses compete." SBA is accepting public comment on the proposal through September 21, 2026.

Why it matters: A size-standard increase can shift a contractor from "other than small" back into small-business territory for a given NAICS code, restoring eligibility for small-business set-asides, sole-source awards, and subcontracting-plan credit. SBA's own estimate of 37,002 newly eligible firms tied to more than $71 billion in fiscal year 2025 contract activity signals how much set-aside competition this could reshape once finalized.

By the numbers:

• 338 industry groups and industries would get new size standards
• 37,002 unique firms with FY 2025 federal contracts SBA estimates would become newly eligible as small businesses
• 105,655 FY 2025 contracts held by those firms, worth more than $71 billion
• 6,459,508 total small business firms projected under the proposed standards, up from 6,344,967 today
• Comments due September 21, 2026 under RIN 3245-AI67 / Docket No. SBA-2026-0199

The proposal restructures how SBA sets standards. Today, SBA sets 978 separate size standards at the 6-digit NAICS level — 496 based on annual receipts and 478 on employee count, plus 18 "exception" subindustries. The proposed rule would consolidate that to 338 standards set at the broader 4-digit (276 standards) and 5-digit (62 standards) NAICS levels, with 129 based on revenue and 208 on employee count, eliminating the 18 subindustry exceptions. SBA also proposes eliminating the current revenue-based maximum of $47 million and employee-based maximum of 1,500 employees, replacing them with no fixed cap.

Sample changes published with the rule: Metal Ore Mining (NAICS 2122) would move from a 1,450- to a 1,500-employee standard; Electric Power Generation, Transmission and Distribution (NAICS 2211) from 700 to 1,150 employees; and Natural Gas Distribution (NAICS 2212) from 500 to 1,150 employees.

Comments may be submitted via the Federal eRulemaking Portal at regulations.gov or by mail to Ryan Lambert, Associate Administrator, Office of Government Contracting and Business Development, who is also SBA's listed contact for the rule.

Source: Federal Register