Senate Democrats report sharp drop in U.S. small business contracting under Trump

Traders Union
All News
Financial News
Small business contract drop under Trump

Highlights

Senate Committee report shows total contract dollars awarded to small businesses are down 19% since Trump took office in January 2025 compared to the previous 16 months.
Massachusetts small businesses lost 31% in contracting dollars, minority-owned businesses nationwide saw a 22% drop, and 2,874 contracts to 8(a) firms were canceled, up 111% versus Biden's term.
Since January 2025, over 65,000 contracts were terminated for convenience—more than 60% held by small businesses—and federal small business participation declined 8%, losing over 6,500 partners.

Report findings on contract losses

As reported by the Senate Committee on Small Business and Entrepreneurship, Ranking Member Edward J. Markey released a report on June 12 that accuses the Trump administration of reducing federal contract access for small businesses through weaker goals, delayed certifications and contract cancellations.

The report says total contract dollars awarded to small businesses nationwide are down 19% since Trump took office in January 2025, compared with the previous 16 months under the Biden administration. It also says Massachusetts small businesses have lost 31% in contracting dollars over that period, while contract dollars to minority-owned small businesses nationwide are down 22%.

Markey says the administration is steering no-bid federal contracts to favored contractors while shutting out veteran-owned, women-owned and minority-owned businesses. He describes the trend as a blow to Main Street at a time when many small companies already face rising costs and economic uncertainty.

Broader impact on U.S. small business participation

The report says more than 65,000 contracts have been terminated for convenience since Trump took office, with more than 60% of those contracts held by small businesses. It also says 2,874 contracts awarded to 8(a) small businesses were canceled, 111% more than under the Biden administration.

According to the findings, the federal government has lost more than 6,500 small business partners since January 2025, an 8% decline from the previous 16 months. The report argues that the drop in participation weakens access to federal procurement for socially and economically disadvantaged businesses that have historically relied on programs such as 8(a) Business Development to reduce barriers to entry.

In our earlier article on the procurement crackdown over “Made in America” claims on GSA Advantage!, we covered how the SBA and GSA removed 22 foreign-made flatware listings after findings that China-based firms had marketed them as American-made. We also noted the administration’s broader push to steer federal purchasing toward domestic suppliers, alongside new SBA support measures for U.S. manufacturers such as a higher Made in America loan guarantee and fee waivers.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.