A new report from the Shapiro-Davis Administration shows more than $1 billion in Pennsylvania spending being directed to small businesses in Fiscal Year 2024-25.
It marks the second straight year Pennsylvania surpassed $1 billion in contracts with small businesses.
“Small businesses are the core of our economy, and we all succeed when small businesses are strong,” Lieutenant Governor Austin Davis, chair of the Pennsylvania Advisory Council for Inclusive Procurement (PACIP), said in a statement. “When small, small diverse, and veteran-owned businesses have a fair shot to compete and win state contracts, they create jobs, strengthen local communities, and make taxpayer dollars work harder. PACIP helps ensure we are listening, learning, and continuously improving how the commonwealth does business.”
Spending with veteran-owned businesses increased by more than 70% last fiscal year, while Pennsylvania spending with Black-owned and Latino-owned businesses grew 45% over the past two years, according to the Fiscal Year 2024-25 Annual Report from the Department of General Services‘ (DGS) Bureau of Diversity, Inclusion, and Small Business Opportunities (BDISBO). Per a release, these results reflect a focused, data-driven approach to procurement that gives small businesses opportunities to strengthen Pennsylvania’s local economies.
Pennsylvania is channeling more contracting dollars to small, small diverse, and veteran-owned businesses than ever before. Throughout FY 2024–25, the Shapiro-Davis Administration strengthened procurement practices, expanded outreach, and applied data-driven goal setting to connect more small businesses to contracting opportunities statewide.
“These results reflect meaningful and strategic progress,” said DGS Secretary Reggie McNeil. “By pairing clear procurement rules with consistent engagement and strong oversight, we are ensuring Pennsylvania’s contracting system remains fair, transparent, and competitive — while creating real opportunities for businesses positioned to grow.”
The Shapiro-Davis Administration’s targeted efforts include the following:
- $77.6 million in contracts were awarded to qualified businesses through the Small Business Reserve Program, exceeding the preliminary annual goal by $18.6 million
- BDISBO increased subcontracting participation goals by 11% in FY 2024–25 by analyzing current data on small businesses and setting targets for individual contracts, ensuring more small businesses had a real opportunity to participate
- There was a 71.6% increase in dollars spent with veteran-owned businesses over the previous fiscal year
- BDISBO engaged over 4,400 entrepreneurs and business advocates by participating in 57 outreach events across Pennsylvania
The Shapiro-Davis Administration continued investing in proven programs that expand opportunities for small businesses, including the Small Business (SBR) Program and Mentor-Protégé Program. The SBR Program reserves certain contracts exclusively for self-certified small businesses. The Mentor-Protégé Program pairs prime contractors with small, small diverse, and veteran-owned businesses to provide hands-on mentoring, business development support, and guidance on navigating Pennsylvania’s procurement process.
“Our focus is on building systems that work — for agencies, for businesses, and ultimately for all Pennsylvanians,” said Dr. Erica Patterson, DGS Deputy Secretary for Business Inclusion and Supplier Development. “By prioritizing accountability, transparency, and collaboration, we’re creating a procurement system that opens doors and delivers measurable results statewide.”
