SBA Struggles to Define "Small Business"

The question of just how big a business can be and still be considered "small" is one that has plagued the U.S. Small Business Administration since its inception. Under current rules, the definition ranges considerably, depending on the particular application or program. In some cases, it is defined as low as $750,000 in annual sales and in other cases as high as $28.5 million. In other cases, it's based upon the number of employees, sometimes 100 or less, but in other cases up to 1,500 or fewer employees.

So why does it matter? What's at stake? Billions of dollars in federal aid and contracts. The Seattle Times reports that lowering the standard to, say, 100 employees would cause massive layoffs, because many companies would lose the government contracts that are their bread and butter. Read more...