By Cecilia Attah
In Nigeria’s ever-changing economic environment, the National Bureau of Statistics (NBS) has revealed recent data that sheds light on a concerning uptick in the nation’s unemployment rate. During the second quarter of 2023, the unemployment rate reached 4.2%, marking a 0.1% increase from the previous quarter. This rise has sparked reflection among policymakers, economists, and citizens as they ponder the root causes and potential remedies for this urgent issue. During the same period, according to the NBS, unemployment among individuals with post-secondary education reached eight per cent, while youth unemployment (15-24 years) escalated to 7.2% in Q2 2023, compared to 6.9% in Q1 2023. This surge in unemployment, particularly among the educated and young population, presents significant economic and social challenges.
“Those with upper secondary education was 5.4 per cent, while those with lower secondary education was 3.7 per cent, 3.0 per cent for those with primary education and 2.5 per cent for those with no formal education, the unemployment rate in urban areas was 5.9 per cent in Q2 2023, which was an increase from the 5.4 per cent recorded in Q1 2023. While the unemployment rate in rural areas was 2.5 per cent in Q2 2023, which was a decline from the 2.9 per cent recorded in Q1 2023.”
Although, according to the National Bureau of Statistics, Nigeria’s unemployment rate decreased from 5.3% in the fourth quarter of 2022 to 4.1% in the first quarter of 2023, the statistics for Q2 2023 indicate a noticeable increase, necessitating a comprehensive examination of the factors contributing to the rise in unemployment. These numbers emphasize the urgency of addressing the issue to avert potential long-term consequences on the nation’s social fabric and economic stability.
The global economic landscape has encountered unprecedented challenges, and Nigeria has not been exempt. Factors such as fluctuating oil prices, population growth, sluggish economic expansion, geopolitical tensions, and the aftermath of the COVID-19 pandemic have adversely affected various sectors, resulting in diminished business activities and fewer job opportunities.
A significant challenge lies in the mismatch between the skills possessed by the workforce and the demands of the evolving job market. Technological advancements and industry transformations have created a gap, leaving many job seekers without the skills required in the modern workforce.
Infrastructure deficits, including unreliable power supply and insufficient transportation networks, hinder business growth and discourage potential investors. Without robust infrastructure, businesses struggle to thrive, limiting their capacity to create new employment opportunities.
Inconsistent policies and regulatory frameworks can impede the growth of businesses, making it difficult for entrepreneurs to navigate the market. Clear, stable policies are essential to fostering an environment conducive to economic growth and job creation.
Simultaneously, corruption within government institutions has adversely affected youth employment. However, the issue extends further, with nepotism and favouritism playing a significant role, resulting in qualified individuals without connections being left unemployed.
Here we have the story of Emmanuel with a degree in petroleum engineering, who got rejected at the Ministry of Petroleum Resources for his NYSC because he had no connection.
“During my service here, I got posted to the Ministry of Petroleum Resources. I was quite excited because it was what I studied and I feel I would learn a lot as much as I contributed what i studied in school since it is related to my course.
The normal process now, come back, come back for your letter and I went back when I was asked to get back, It was one story and another, ‘my boss is not around, my boss is not around’, So I kept on going back, kept getting disappointed because they keep asking me to come back.
So on this particular day, I went back and while I was there waiting, one man walked past and he was like howfar you don dey here since, who carry you come, I was like nobody, NYSC posted me here, the man immediately said I should just forget it, that he’s not sure I would be accepted, since nobody recommended me, I didn’t want to read too much meaning to it but in my presence, a corps member walked in with a man perceived to be her uncle and immediately her letter was accepted even though she studied English in the university
It was like film trick, when I went back to ask for the letter, I was told that I can’t be accepted, there and then they prepared a rejection letter for me, I was so downcasted because irrespective of your qualifications, you need connection.”
Potential Solutions:
Establish independent oversight bodies to monitor recruitment processes, ensuring fair consideration of qualified individuals regardless of personal connections.
Prioritizing education and vocational training programs that align with the needs of the job market can bridge the skills gap. By equipping the workforce with relevant skills, the nation can enhance its global competitiveness and attract investment.
Addressing infrastructure challenges requires significant investment in key sectors such as energy, transportation, and telecommunications. A robust infrastructure foundation can stimulate economic growth, attract foreign direct investment, and create job opportunities.
Policymakers must work towards creating a stable and supportive business environment. Consistent and transparent policies can boost investor confidence, encourage entrepreneurship, and foster a climate conducive to job creation.
Supporting the growth of SMEs can be a catalyst for job creation. Governments and financial institutions can collaborate to provide affordable credit, technical assistance, and other resources to empower small businesses.
Effective policies and initiatives are imperative to address this concerning trend, encompassing measures such as promoting entrepreneurship, investing in education and skills training, and fostering a conducive environment for business growth and job creation.
Additionally, the potential of using artificial intelligence to address unemployment in Nigeria, emphasizing the importance of AI-driven matching of graduates with jobs can help address the situation.
The consequences of escalating youth unemployment extend beyond economic implications, encompassing increased crime, social unrest, and the potential departure of educated individuals seeking opportunities abroad. Tackling youth unemployment is paramount for Nigeria’s long-term sustainable development.
Comparatively, Nigeria’s unemployment rate, though high, is not isolated, with other African countries facing similar challenges. South Africa, Djibouti, Eswatini, and Lesotho exhibit higher unemployment rates, while Mauritius, Rwanda, and Tanzania boast lower rates. However, variations exist within regions and socioeconomic groups.
Despite the Nigerian government’s implementation of youth employment programs which includes N-power, YouWiSE and others, challenges persist, including bureaucratic hurdles, delayed fund disbursement, monitoring deficiencies, and inadequate inter-agency coordination. These hurdles limit the impact of initiatives, hindering a substantial reduction in youth unemployment rates.
The effectiveness of Nigeria’s initiatives remains a topic of debate when compared to efforts in other African nations. While progress has been made, a comprehensive, multi-stakeholder approach is necessary to address the multifaceted challenges of youth unemployment effectively.
In summary, the reported increase in Nigeria’s unemployment rate to 4.2% in the second quarter of 2023, as per the NBS, necessitates immediate and targeted measures to counteract this surge. The focus should be on stimulating economic growth, creating job opportunities, and mitigating social consequences, particularly among the youth and educated demographic. A comprehensive strategy should include the adoption of technology, investment in skills development, and support for entrepreneurship, recognizing these as crucial elements to tap into the potential of Nigeria’s youthful population and address the persistent issue of youth unemployment.
To tackle Nigeria’s current unemployment challenge effectively, a multi-pronged approach is essential, encompassing both short-term relief and long-term structural reforms. As stakeholders collaborate to implement strategic interventions, the nation can aim to reverse the current trend and cultivate a more resilient and inclusive economy. Although the road ahead may pose challenges, concerted efforts could empower Nigeria to emerge stronger and more prosperous.
