The U.S. Small Business Administration (SBA) announced Friday an agencywide restructuring that will cut its workforce by 43% through the elimination of 2,700 positions.
The SBA’s new administrator, Kelly Loeffler, said “core services” would not be impacted, such as the agency’s loan guarantee and disaster assistance programs, and its field and veteran operations. Loeffler said the staff cuts would produce a $435 million savings.
There are 33.2 million small businesses in the United States that collectively employ 46% of America’s private-sector workforce. Congress created the SBA in 1953 to provide loans to small companies that need capital, help small businesses win federal contracts and offer entrepreneurs counseling, technical assistance and other support.
In recent years, the SBA’s workforce expanded to administer the Paycheck Protection Program, which helped keep small businesses open during the pandemic, as well as run other new small business initiatives.
“By eliminating non-mission-critical positions and consolidating functions, we will revert to the staffing levels of the last Trump administration,” Loeffler said in a statement. The SBA has become plagued by “mission creep,” she said, and she singled out programs such as the Green Lender Initiative, the Community Navigator Pilot Program and “DEI activities.”
The layoffs at the SBA are part of a broader campaign by the Trump Administration to shrink the federal workforce, an effort has been led by Elon Musk’s Department of Government Efficiency. Tens of thousands of federal workers have been laid across all federal agencies.
On Friday, the Associated Press reported that President Donald Trump told reporters in the Oval Office that the SBA should handle student loans, instead of the Department of Education, which was dismantled the previous day by executive order.
