The U.S. Small Business Administration (SBA) has announced a major reorganization aimed at enhancing accountability and refocusing efforts on supporting small businesses. This strategic shift includes a significant workforce reduction of 43%, cutting approximately 2,700 positions from its current total of around 6,500.
Authorized under Executive Order 14210, the restructuring seeks to dismantle non-essential roles that were established during the pandemic, bringing SBA staffing levels back to what they were prior to COVID-19. By eliminating excess roles, the SBA anticipates saving taxpayers over $435 million annually by the Fiscal Year 2026, with the average salary of eliminated positions exceeding $132,000.
Despite these reductions, the SBA assures that essential services such as loan guarantee programs, disaster assistance, field operations, and veteran support will remain unaffected. SBA Administrator Kelly Loeffler emphasized the agency’s need to focus on its original mission of fostering small business growth, stating, “The SBA was created to be a launchpad for America’s small businesses, but in the last four years, it has strayed from this path.”
Key elements of the reorganization will involve reallocating resources away from prior programs deemed non-essential to prioritize risk management and fraud prevention, particularly within the Office of the Chief Financial Officer. Additionally, there will be increased support for disaster recovery by transferring loan servicing and personnel duties to the Office of Disaster Recovery and Resilience.
The SBA plans to achieve a more decentralized approach, setting a goal for 30% of agency staff to operate in the field to improve outreach efforts to small businesses. Specific offices, such as the Office of Veterans Business Development and the Office of Manufacturing and Trade, will maintain their existing staffing levels, while others, including the Office of Advocacy and the Office of the Inspector General, will be exempt from reductions.
The SBA’s restructuring is a response to concerns over financial performance and service quality that have arisen during the previous administration. The agency has flagged substantial issues, such as an estimated $200 billion in pandemic-related fraud, which further underscores the need for this organizational overhaul.
The agency plans to implement these changes in the coming weeks while ensuring the continuity of essential public services.
