The U.S. federal government met its annual government contracting goal for small businesses — for the first time in 8 years.
Government contracting goals are measured as a percentage of overall government contracts awarded. For 2013 the goal was to award 23% of all prime contracts to small businesses. In fact, the federal government awarded 23.9% of prime contracts to small businesses, worth $83.1 billion. As a whole, the federal government achieved a score of “A” or 100.60% on a scorecard methodology used to measure the goals. See image above containing a partial screenshot of the 2013 scorecard.
SBA Administrator Maria Contreras-Sweet announced the results on Friday afternoon. “When we hit our small business procurement target, it’s a win. Small businesses get the revenue they need to grow and create jobs, and the federal government gets the chance to work with some of the most responsive, innovative and nimble companies in the U.S. while the economy grows,” she said.
The SBA actually measures federal government contracting goals for five different groups of small businesses. For 2013 three groups had their goals met while two (women owned small businesses and HUBZone businesses) did not.
Here’s the prime contracting breakdown:
- Small Business - Goal of 23%. Achieved 23.39% ($83.1 billion)
- Women Owned Small Business - Goal of 5%. Achieved 4.32% ($15.4 billion)
- Small Disadvantaged Business - Goal of 5%. Achieved 8.61% ($30.6 billion)
- Service Disabled Veteran Owned Small Business - Goal of 3%. Achieved 3.38% ($12.0 billion)
- HUBZone Business - Goal of 3%. Achieved 1.76% ($6.2 billion)
The SBA serves as the champion of small business government contracting.
One way it does that is through establishing and measuring government contracting goals, and then reporting them to the public. But individual agencies actually award the contracts. The Small Business Administration has no power to award government contracts, except for its own agency and it has one of the smallest budgets.
Which Agencies Met Their Small Business Government Contracting Goals?
Each year the SBA publishes scorecards not only for the government as a whole, but for individual agencies to show how each performed.
The majority of federal agencies met their government contracting goals in 2013.
Three agencies, in fact, did so well they earned A+ scores. They were the Office of Personnel Management, Department of the Interior, and Department of Transportation.
However, four agencies have some work to do because they did not meet their government contracting goals. They include:
- Department of Energy, with a dismal score of “F” at 68.09%
- Department of Justice, with a score of “B” at 91.7%
- Department of Defense, with a score of “B” at 93.55%
- National Science Foundation, with a score of “B” at 95.84%
Still, percentages can give a skewed picture. That’s because government agencies have vastly different budgets.
Take, for example, the Department of Defense. The DoD has a huge government contracting budget. Defense by itself accounted for over half of the total dollar value of government contracts awarded last year. It awarded a whopping $48.3 billion in government contracts to small businesses.
Compare that to the Department of the Interior. Interior earned an impressive 122.5% of its goal. However, the Department of Interior granted only $1.4 billion in government contracts to small businesses. Its budget is much smaller.
In other words, while the Department of Interior earns kudos for doing so well on its goal, the Department of Defense had a much bigger impact on small businesses in 2013. The DoD awarded far more in dollar value of government contracts to small businesses than any other federal agency. The Department of Defense will continue to have an outsized impact on small business contracting in 2014.
Individual scorecards for each agency for the past eight years are here on the SBA website.