Small Businesses Struggle to Fill Jobs as Labor Quality Concerns Hit Highest Level Since 2021 – KCLY Radio

Analysis of Small Business Labor Market Trends in Relation to Sustainable Development Goals

Challenges to Full and Productive Employment (SDG 8)

• Unfilled Job Openings: In October, 32% of small business owners reported job openings they could not fill. This stagnation at a high level poses a challenge to achieving full and productive employment as outlined in SDG 8.
• Job Creation Plans: A net 15% of owners plan to create new jobs in the coming months. While this supports the economic growth aspect of SDG 8, it marks a slight downturn in hiring intentions for the first time since May 2025.
• Hiring Activity: 56% of small businesses were actively hiring or attempting to hire, indicating a demand for labor, yet the difficulty in filling positions hinders sustained economic growth.

Skills Gaps and Implications for Quality Education (SDG 4 & SDG 8)

• Qualified Applicant Shortage: A significant 88% of hiring firms reported finding few or no qualified applicants. This points to a critical skills gap, undermining the goal of decent work (SDG 8) and highlighting the need for improved access to quality education and vocational training (SDG 4).
• Labor Quality as a Primary Concern: Labor quality was cited as the single most important problem by 27% of owners, a 9-point increase and the highest level since November 2021. This directly impacts productivity and sustainable economic progress.

1. Openings for skilled workers remained unchanged at 28%.
2. Openings for unskilled labor declined by 2 points to 11%.

Sectoral Disparities and Reduced Inequalities (SDG 10)

• High-Impact Sectors: The challenge of finding qualified labor was most acute in the construction, transportation, and professional services sectors, revealing inequalities that can inhibit balanced growth across the economy (SDG 10).
• Construction Sector Analysis: Nearly half of all construction businesses listed labor quality as their primary problem, a stark contrast to only 13% in the finance sector. This disparity underscores the unequal barriers to achieving sustainable development across different industries.

Wage Growth and Decent Work Conditions (SDG 1 & SDG 8)

• Compensation Trends: A net 26% of owners reported raising employee compensation, a key component of decent work (SDG 8). A further 19% plan to raise pay in the next three months.
• Contribution to Poverty Reduction (SDG 1): These wage increases contribute to ensuring workers can achieve a decent standard of living, directly supporting the objective of SDG 1 (No Poverty).
• Labor Costs: The share of owners identifying labor costs as their top problem fell to 8%, suggesting that the primary barrier to growth is the availability of a skilled workforce rather than the cost of labor.

Analysis of Sustainable Development Goals in the Article

1. Relevant Sustainable Development Goals (SDGs)

1. SDG 8: Decent Work and Economic Growth
   • The article’s entire focus is on the labor market, specifically within the small business sector, which is a key driver of economic growth. It discusses job creation, hiring challenges, labor quality, and wage growth, all of which are central themes of SDG 8, which aims to “promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.”

2. Specific SDG Targets

1. 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.
   • The article connects to this target by highlighting the gap in achieving “full and productive employment.” The fact that 32% of small businesses have job openings they cannot fill indicates a mismatch in the labor market. Furthermore, the discussion of a net 26% of owners raising wages relates to the “decent work” and pay aspects of this target.
2. Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation…
   • This target is relevant because the primary issue identified in the article is the lack of “qualified workers.” Labor quality is cited as the biggest problem for 27% of business owners, particularly in productive sectors like construction and transportation. A skilled workforce is essential for achieving higher levels of economic productivity, and the article shows this is a significant challenge.

3. Indicators for Measuring Progress

1. Indicators for Target 8.5 (Full Employment and Decent Work):
   • Percentage of businesses with unfilled job openings: The article explicitly states, “32% of small business owners said they had job openings they could not fill.” This is a direct indicator of labor shortages and the gap in achieving full employment.
   • Job creation plans: The article mentions, “A net 15% of small business owners plan to create new jobs in the next three months.” This serves as a forward-looking indicator of employment growth.
   • Rate of wage increases: The text reports, “A net 26% of owners reported raising wages in October.” This can be used as a proxy indicator to measure progress towards the “decent work” component of the target.
2. Indicators for Target 8.2 (Economic Productivity):
   • Perception of labor quality as a business problem: The article notes that “27% of owners saying it is their biggest problem, up 9 points from September and the highest since November 2021.” This is a strong indicator of a skills gap that directly hinders productivity.
   • Success rate in finding qualified applicants: The report that “88% [of those hiring] said they found few or no qualified applicants” is a clear metric of the mismatch between the skills demanded by employers and those available in the labor pool, which is a direct barrier to increasing productivity.

Summary Table of SDGs, Targets, and Indicators

Source: kclyradio.com