SBA to Reduce Workforce by Over 40% Amid Agency Restructuring

Washington, D.C. — The Small Business Administration announced on Friday it will reduce its workforce by more than 40% as part of a directive from the Trump administration to streamline the federal government. The agency, which employs roughly 6,500 people, aims to cut its staff by 43%, saving over $435 million annually by the next fiscal year.

The SBA stated in a press release that this strategic reorganization is intended to restore the efficiency if its operations while emphasizing support for small businesses. Importantly, the agency assured that core services such as loan guarantees and disaster assistance programs will remain unaffected by the layoffs.

Former Senator Kelly Loeffler was confirmed as the SBA’s administrator by the Senate in February. In a video posted to X on Friday, Loeffler pointed to the agency’s expansion since the pandemic as a key reason behind the personnel reductions. “Since the pandemic, the SBA has doubled its workforce, expanding in size, scope, and spending with miserable results,” Loeffler said. “That’s why change is coming to the SBA. We will evaluate every program and expenditure and we will rightsize the agency to transform the SBA into a high-efficiency engine for America’s entrepreneurs and taxpayers.”

The SBA employs staff across various district offices nationwide, with Texas having the highest number of employees, surpassing even the District of Columbia, where the agency is located.

Friday’s announcement follows President Trump’s declaration that the SBA will take on responsibility for managing federal student loan programs. This decision comes one day after he signed an executive order directing the transition away from the Education Department, which currently oversees these programs. Experts have expressed concern that this move could create turmoil for millions of borrowers facing student debt.

Previously, administration officials had indicated that student loan programs might eventually be overseen by the SBA, Treasury, or Commerce Departments. The Small Business Administration, established in 1953 during Dwight D. Eisenhower‘s presidency, was created to “aid, counsel, assist and protect, insofar as is possible, the interests of small business concerns.” Historically, it has provided loans and resources to businesses impacted by natural disasters and international trade issues. During the COVID-19 pandemic, the agency’s federally backed loans and grants proved essential for many small businesses and nonprofit organizations.