NFIB jobs report: Lack of labor quality puts July job openings lowest since 2020 – ROI-NJ

Analysis of Small Business Employment Trends in Relation to Sustainable Development Goals

Executive Summary: Aligning Economic Indicators with SDG 8

This report analyzes the July 2025 jobs data from the National Federation of Independent Business (NFIB) through the framework of the United Nations Sustainable Development Goals (SDGs), with a primary focus on SDG 8: Decent Work and Economic Growth. The findings indicate persistent challenges in the labor market that impact the achievement of sustained, inclusive, and sustainable economic growth, full and productive employment, and decent work for all.

Key Findings on Labor Market Dynamics and SDG 8

Unfilled Job Openings: A Challenge to Productive Employment

The report highlights a persistent gap between labor demand and supply, a direct challenge to Target 8.5 of the SDGs, which aims for full and productive employment. While the rate of unfilled positions has decreased, it remains significantly above historical norms, indicating ongoing friction in the labor market.

• 33% of small business owners reported job openings they could not fill, a decrease of three points from June.
• This figure represents the lowest level since December 2020.
• However, it remains substantially higher than the historical average of 25%, signaling a structural impediment to achieving full employment as outlined in SDG 8.

Labor Quality and Skills Gap: An Obstacle to Decent Work

A critical barrier to achieving SDG 8 is the quality of the labor force. A significant portion of business owners identified labor quality as their primary operational problem, underscoring a mismatch between available skills and employer needs. This points to challenges related to SDG 4 (Quality Education) and its impact on creating a job-ready workforce.

1. Primary Business Problem: 21% of owners cited labor quality as their single most important problem, a five-point increase from the previous month.
2. Applicant Qualification: 48% of owners hiring or trying to hire reported receiving few or no qualified applicants.
   • 29% reported few qualified applicants.
   • 19% reported no qualified applicants.
3. Skills Breakdown: The demand for skilled labor continues to outpace that for unskilled labor, with 29% of openings for skilled workers versus 12% for unskilled labor. This disparity affects progress towards SDG 10 (Reduced Inequalities) by limiting opportunities for lower-skilled individuals.

Sectoral and Regional Perspectives on Sustainable Growth

Industry-Specific Contributions to SDG 9

Job opening distribution varies across sectors, impacting SDG 9 (Industry, Innovation, and Infrastructure). Key industries like construction, wholesale, and transportation show high demand, reflecting their role in economic infrastructure. Conversely, lower demand in finance and agriculture suggests differing labor dynamics within these sectors.

• Highest Demand: Construction, wholesale, and transportation industries.
• Lowest Demand: Finance and agriculture industries.

Policy Implications for Sustainable Communities (SDG 11)

From a regional perspective, state-level policies are crucial for fostering a business climate conducive to private sector growth, which underpins the economic vitality of local communities as envisioned in SDG 11 (Sustainable Cities and Communities). As stated by NFIB New Jersey State Director Eileen Kean, policymakers must prioritize the business climate to achieve a “robust and growing economy,” which directly supports community well-being and local economic resilience.

Future Outlook: Job Creation and Fair Compensation

Projections for Economic Growth and Employment

Future hiring plans suggest a continued, albeit modest, commitment to job creation, aligning with the economic growth aspect of SDG 8. A net 14% of owners plan to create new jobs in the next three months, which is above the historical average of 11%.

Compensation Trends and Decent Work

Compensation trends are a key indicator of progress towards “decent work.” While a significant number of businesses have recently raised compensation, the forward-looking trend shows a slight cooling. This has implications for Target 8.5, which includes equal pay for work of equal value.

• A net 27% of owners reported raising compensation in July, down six points.
• A net 17% plan to raise compensation in the next three months, a two-point decrease.
• Labor costs were cited as the single most important problem by 9% of owners, indicating that wage pressures remain a consideration for sustainable business operations.

Analysis of Sustainable Development Goals (SDGs) in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

The primary SDG addressed in the article is:

• SDG 8: Decent Work and Economic Growth – This goal is central to the article, which focuses entirely on employment issues, job creation, labor quality, and the economic health of small businesses. The text discusses challenges in filling job openings, the need for qualified workers, and the impact of these issues on the local economy. The call for policymakers to “prioritize New Jersey’s business climate and private sector job growth” directly aligns with the objectives of SDG 8.

2. What specific targets under those SDGs can be identified based on the article’s content?

Based on the article’s focus on small businesses and employment, the following specific targets under SDG 8 can be identified:

• SDG 8: Decent Work and Economic Growth

  1. Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises.
     • Explanation: The article is exclusively about the challenges faced by “small business owners” and “Main Street employers.” The statement by the NFIB New Jersey State Director that “Policymakers in Trenton must prioritize New Jersey’s business climate and private sector job growth” is a direct call for the development-oriented policies mentioned in this target to support small enterprises.
  2. Target 8.5: By 2030, achieve full and productive employment and decent work for all women and men… and equal pay for work of equal value.
     • Explanation: The article highlights a gap in achieving “full and productive employment” by stating that “33% (seasonally adjusted) of small business owners reported job openings they could not fill.” The discussion around compensation, where a “net 27% of small business owners reported raising compensation,” relates to the “decent work” aspect of this target.
  3. Target 8.6: By 2020, substantially reduce the proportion of youth not in employment, education or training.
     • Explanation: While the target date has passed, the principle remains relevant. The article implies a skills mismatch, which is a key driver of youth unemployment. The fact that “21% of small business owners cited labor quality as their single most important problem” and that “48%… of owners reported few or no qualified applicants” points to a workforce that is not adequately trained for available jobs. This directly connects to the goal of ensuring people, particularly the young, are prepared for employment.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

Yes, the article provides several quantitative data points that can serve as indicators to measure progress towards the identified targets.

• Indicators for Target 8.3 (Support for Small Enterprises)

  • Indicator: Percentage of small business owners planning to create new jobs.
    • Data from article: “A seasonally adjusted net 14% of owners plan to create new jobs in the next three months.” This measures the growth and job creation potential of small businesses.
  • Indicator: Percentage of small businesses actively hiring.
    • Data from article: “Overall, 57% of small business owners reported hiring or trying to hire in July.” This indicates the level of economic activity and demand for labor from small enterprises.

• Indicators for Target 8.5 (Full and Productive Employment)

  • Indicator: Job vacancy rate in the small business sector.
    • Data from article: “33%… of small business owners reported job openings they could not fill.” This is a direct measure of the gap between labor demand and supply.
  • Indicator: Rate of wage and compensation growth.
    • Data from article: “A net 27% of small business owners reported raising compensation in July.” This serves as a proxy for progress towards “decent work.”

• Indicators for Target 8.6 (Skills Mismatch)

  • Indicator: Percentage of employers reporting a lack of qualified applicants.
    • Data from article: “Forty-eight percent (84% of those hiring or trying to hire) of owners reported few or no qualified applicants for the positions they were trying to fill.”
  • Indicator: Percentage of employers identifying labor quality as a primary business problem.
    • Data from article: “Twenty-one percent of small business owners cited labor quality as their single most important problem in July.” This quantifies the severity of the skills gap from the employers’ perspective.

4. Summary Table of SDGs, Targets, and Indicators

Source: roi-nj.com