Report: SBA Staffing Cuts Reduce Service to Entrepreneurs

Staffing cuts and tighter underwriting standards have reportedly made it more difficult for entrepreneurs to get help from the Small Business Administration (SBA).

The SBA’s staffing level, which had surged to nearly 10,000 during the pandemic before falling to 6,000 by the end of the Biden administration, is set to be reduced with another 2,700 cuts announced in March, the New York Times reported Friday (May 23).

According to the report, these cuts have led to calls to the phone line of the SBA’s COVID-era disaster loan program going unanswered and its team that investigates fraud in that program being fired.

SBA spokeswoman Caitlin O’Dea told The New York Times that the reorganization would “redirect all resources to support the core mission of empowering small businesses and driving economic growth, instead of supporting the partisan programs that took root under the Biden administration.”

The SBA has also eliminated hardship accommodations that enabled businesses to make only minimum interest payments and tightened the standards for its program that facilitates loans of up to $5 million, according to the report.

The Biden administration had loosened those standards, and the number of defaults had risen. The rise in defaults was driven by both the weaker underwriting standards and rising interest rates, per the report.

When announcing its 43% workforce reduction in March, the SBA said in a press release that the cuts would return the agency to the staffing levels it had before the pandemic, during the first term of President Donald Trump, and would refocus its resources on its “core missions” of small business promotion, loan guarantee and disaster assistance programs, and field and veteran operations.

“The SBA was created to be a launchpad for America’s small businesses by offering access to capital, which in turn drives job creation, innovation and a thriving Main Street,” SBA Administrator Kelly Loeffler said in the release. “But in the last four years, the agency has veered off track — doubling in size and turning into a sprawling leviathan plagued by mission creep, financial mismanagement and waste.”

March 2025 data from the PYMNTS Intelligence SMB Growth Report found that small and medium-sized businesses are generally optimistic about long-term growth, with most reporting increasing revenues in the past year.

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