March 7, 2016
Expanded list of Industries eligible for WOSB set-asides released
APTAC Staff article
Effective Wednesday, March 3, SBA made major changes to the Women’s contracting program. Pursuant to the National Defense Authorization Act of 2015, a study was conducted by the Office of the Chief Economist (OCE) U.S. Department of Commerce, which analyzed data to help SBA determine those NAICS codes in which WOSBs are underrepresented and substantially underrepresented in Federal contracting. The OCE looked at whether, holding constant various factors that might influence the award of a contract, the odds of winning Federal prime contracts by firms that were owned by women were greater or less than the odds of winning contracts by otherwise similar businesses.
Overall the study found that the odds of winning a contract for Woman-Owned Businesses (WOBs) are estimated to be roughly 21 percent lower relative to the odds of winning contracts by otherwise similar firms that were not identified as WOBs. The OCE’s analysis, controlled for the size and age of the firm; its membership in various categories of firms for which the Federal government has government-wide prime contracting goals; its legal form of organization; its level of government security clearance; and its Federal prime contracting past performance ratings.
Also considered was whether WOBs typically have significantly different experiences in winning contracts depending on their industry. The analysis was performed at the four-digit NAICS industry group level, including each firm in the sample in an industry analysis if the firm had registered as being able to perform work in that industry or if the firm had won a contract assigned to that industry.
The industry-specific results on the odds of winning contracts vary considerably. In 109 industries (36 percent of the total), WOBs have statistically significant lower odds of winning contracts, covering 62 percent of contracts and nearly two-thirds of dollars obligated under contracts awarded in FY 2013 or 2014. In an additional 145 (48 percent) of the 304 industries included in the study, the odds of WOBs winning contracts were lower than those of otherwise similar non-WOBs, but in these cases there is not a statistically significant difference between the odds of winning contracts for the two groups. Overall, the industries in which WOBs are less likely to win contracts account for about 85 percent of contracts and of dollars obligated in Fiscal Years 2013-2014 (which is the period in which the data originated).
As a result, SBA has changed its rules with both a substantial increase (from 330 to 445) in the number of eligible NAICS codes, and a pronounced shift from assignments which heavily favored the EDWOSBs over the WOSBs to the reverse. Under the new rule, 365 NAICS codes are eligible for WOSB set-asides – 82% of the total – making many more businesses in far more industries potential beneficiaries of WOSB set-asides. It will now be much easier for contracting officers to satisfy “Rule of Two” competition requirements, and thus easier to decide to set-aside for women. All EDWOSB-qualified companies automatically also qualify as WOSB, so they are also likely to benefit from the change.
Review the new NAICS lists below:
Details of the Women-Owned Small Business Program can be found at FAR 19.15 Woman-Owned Small Business Program. The section that implements the program, FAR 19.1505(a), references the “SBA-maintained NAICS list”; consequently, no change to the FAR is required to implement these changes, which are effective immediately (3/3/2016).
Federal Register Vol. 81, No. 42, March 3, 2016 p. 11340-11343
New .pdf tables of the WOSB and EDWOSB NAICS codes can be found at:
Are you a woman business owner? Contact your nearest PTAC to see how you can most effectively leverage your status!
For help with Government Contracting: contact your nearest Procurement Technical Assistance Center (PTAC). Funded through Cooperative Agreements between the U.S. Department of Defense and state and local governments/institutions, PTACs provide free and low-cost assistance in virtually all areas of government contracting.