Small Business Administration will cut 43% of workers due to DOGE

The Small Business Administration (SBA) is preparing to cut 43% of its workforce, citing Elon Musk's Department of Government Efficiency as the impetus behind the employee terminations.

The agency, which employs more than 6,000 workers, said in a statement Friday that it plans to cut "non-essential roles" and return to staffing levels from before the COVID-19 pandemic. 

"The strategic reorganization will begin a turnaround for the agency by restoring the efficiency of the first Trump Administration, as well as its focus on promoting small businesses," the SBA said in a statement. "Core services to the public, including the agency's loan guarantee and disaster assistance programs, as well as its field and veteran operations, will not be impacted."

The cuts are the latest round of mass staffing reductions at federal agencies as President Donald Trump and Musk's DOGE have worked to downsize the government. Last week, agencies were required to submit their recommendations for large-scale cuts to the White House.

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The SBA said the cuts would save about $435 million from the annual federal budget by fiscal year 2026. The average employee salary is more than $132,000, according to the agency.

The SBA, which is led by Kelly Loeffler — a former senator and a major Trump donor — runs several programs through field offices across the country that help entrepreneurs get training and access capital. The agency administered the pandemic-era Paycheck Protection Program, a loan forgiveness program that many companies credit with helping them survive lockdowns, but also was riddled with fraud due to lax lending requirements.

The SBA has already faced some snafus in attempts to reduce its workforce. Last month, the SBA told probationary employees it was eliminating their jobs, only to immediately alert them that the first message was an error. The next day, those employees were told they were, in fact, terminated.

The announcement follows other federal cuts, including plans at the Department of Veterans Affairs to eliminate 80,000 workers. The Education Department said it would cut half of its 4,000 workers earlier this month. On Thursday, Trump signed an executive order calling to urther dismantle the department and its programs and called on Congress to full eliminate it.