The most common NAICS codes for government contractors include 541511 (Custom Computer Programming), 541512 (Computer Systems Design), 236220 (Commercial Building Construction), 237310 (Highway Construction), and 336411 (Aircraft Manufacturing). Each code has specific size standards determining small business eligibility based on annual receipts or employee count. Strategic selection of appropriate NAICS codes increases visibility to federal buyers, enhances competitive positioning, and improves access to set-aside opportunities. The following sections explore these classifications in greater detail.
Most Utilized NAICS Codes in Federal Contracting
While traversing the federal contracting landscape, businesses must understand the most frequently used NAICS codes to identify viable opportunities. Federal procurement trends consistently show technology and construction sectors dominating government spending. Federal registration compliance requires careful attention to code selection accuracy and ongoing maintenance.
NAICS 541511 (Custom Computer Programming Services) and 541512 (Computer Systems Design Services) represent significant technology expenditures across agencies.
Construction-related codes, including NAICS 236220 (Commercial Building Construction) and 237310 (Highway, Street, and Bridge Construction), capture substantial infrastructure investments.
Contracting opportunities analysis reveals defense and security services remain highly prioritized in federal budgets. NAICS Code 336411 Aircraft Manufacturing consistently leads government contract awards, highlighting the defense industry’s significant influence on federal spending. Professional services, particularly management consulting and data analysis, also maintain strong demand.
NAICS 621111 for Offices of Physicians is increasingly important as government agencies expand healthcare service contracts.
Businesses should note that approximately 200 NAICS codes appear on the GSA Multiple Award Schedule, creating streamlined pathways to federal contracts across various industries.
Size Standards and Small Business Eligibility by NAICS Code
Because federal contracts often designate specific set-asides for small businesses, understanding size standards associated with NAICS codes becomes critical for determining eligibility.
The SBA establishes these size standards, which vary by industry and determine whether a business qualifies as “small” for government contracting purposes.
Industry-specific size standards set by the SBA define which businesses qualify as “small” for federal contracting opportunities.
Size standards typically use two primary metrics: annual receipts or number of employees. When calculating size, businesses must include all affiliates’ data to determine their total size.
System for Award Management registration is required for businesses seeking federal contracts and grants, enabling enhanced visibility to government agencies.
Contracting officers specify the applicable NAICS code and corresponding size standard in each solicitation. Procurements are classified based on the component that accounts for the greatest percentage of contract value.
To qualify as a small business, companies must:
- Be for-profit
- Operate independently
- Not dominate their field nationally
- Maintain a physical location in the U.S.
- Meet the specific size standard for their assigned NAICS code
Strategic NAICS Code Selection for Government Contractors
Strategic selection of NAICS codes represents one of the most critical decisions a government contractor must make when pursuing federal opportunities. The proper code classification directly impacts a company’s competitive advantage in the government marketplace, determining which contracts they can pursue and their eligibility for set-aside programs.
Contractors should develop targeted procurement strategies by analyzing which NAICS codes align with their core competencies and services. This targeted approach saves valuable bidding resources while increasing win probability. Federal agencies’ goals for supplier diversity make accurate NAICS code selection essential for businesses seeking opportunities in government contracting.
Government buyers use these codes to find qualified vendors, making accurate classification essential for visibility in the procurement process. The six-digit structure of NAICS provides greater specificity than the older SIC system, enabling more precise matching between contractors and government requirements.
Companies that strategically select and monitor their NAICS codes gain significant advantages in market analysis, allowing them to track competitor activities and identify emerging contract opportunities before they become widely known. Small businesses can leverage NAICS codes to pursue contracts that are specifically reserved for them through various set-aside programs.
Frequently Asked Questions
How Often Are NAICS Codes and Size Standards Updated?
NAICS codes undergo revisions every five years, with the most recent update occurring in 2022. This regular revision cycle guarantees classifications accurately reflect changes in the North American economy.
Size standards updates follow a different schedule, with the SBA periodically reviewing and adjusting them based on industry growth, market conditions, and inflation factors.
These updates are vital for government contractors, as they determine eligibility for small business set-aside contracts and certification programs.
Can a Business Qualify Under Multiple NAICS Codes Simultaneously?
Yes, a business can qualify under multiple NAICS codes simultaneously. For government contracting purposes, companies may register several classifications in systems like SAM, typically up to 5-10 codes per establishment.
NAICS code eligibility allows businesses to pursue diverse contract opportunities across different industries where they have capabilities. While the Census Bureau assigns only one primary code for statistical purposes, contracting agencies recognize multiple classifications, enabling businesses to compete for various contracts if they meet the size standards for each code.
What Happens if My Company Outgrows Its Small Business Status?
When a company outgrows its small business status, it loses eligibility for set-aside contracts and government incentives specifically designed for small businesses.
The shift affects marketing advantages and access to federal contract opportunities targeted at small business goals.
Companies experiencing small business growth should consider strategic planning options, such as partnering with remaining small businesses or reassessing NAICS classifications to maintain eligibility where possible under different industry size standards.
How Do NAICS Codes Impact Joint Ventures in Federal Contracting?
NAICS codes play an essential role in joint venture eligibility for federal contracts. Each participant must meet the size standard of the specific NAICS code assigned to a contract to qualify as small.
Joint ventures must guarantee NAICS code alignment with their offered services to maintain compliance. When all parties qualify as small under the relevant NAICS code, the joint venture can avoid affiliation concerns.
For mentor-protégé arrangements, the protégé must meet the applicable NAICS size standards.
Can I Challenge a Solicitation’s Assigned NAICS Code?
Yes, businesses can challenge a solicitation’s assigned NAICS code through formal NAICS code appeals.
Interested parties have 10 days from solicitation issuance to file an appeal with the SBA’s Office of Hearings and Appeals. Appeals must demonstrate solicitation discrepancies between the procurement’s principal purpose and the assigned code.
Approximately 45% of appeals decided on merit succeed. A successful challenge can greatly impact competition by changing size standards, potentially allowing more small businesses to participate in the procurement.