A new report from the United Nations Development Programme (UNDP) and the National Bureau of Statistics (NBS) has shown that 20 percent of the full-time workforce in Nigeria lost employment during the COVID-19 pandemic in 2020
The report, which assesses the impact of COVID-19 on business enterprises in Nigeria, was based on in-depth interviews with almost 3,000 businesses from both the formal and informal sectors across major industries of the economy.
The report stressed that while there had been promising signs of recovery this year, COVID-19 has had an outsized socio-economic impact on Nigeria.
It went further to say from disruptions in the supply chains to ongoing supply and demand shocks and a drop in consumer confidence, these challenges were expected to leave a lasting impact on the businesses and enterprises that make up the backbone of the economy.
It explained that the impact of COVID-19 on business enterprises in Nigeria also highlights the significant decline in revenue faced by enterprises and establishments across the country as a result of the pandemic.
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The report pointed out that 81 percent of enterprises interviewed experienced a decline in revenue and 73 percent stated that they faced liquidity challenges due to secondary impacts of COVID-19 in 2020, adding that the median loss in revenue reported remained at 44 percent, in comparison to 2019 revenues.
The UNDP and NBS report hinted that close to 60 percent of enterprises surveyed experienced an increase in operational costs with the price of raw materials and logistics being the top two contributors to this increase.
The report showed that one in three business enterprises surveyed indicated that they know of businesses that had permanently closed due to operational challenges resulting from the pandemic.
It said data from the report suggested that businesses are likely to continue experiencing the impact of the pandemic even after the easing of public health measures.
According to the report, “despite reduced restrictions at the time of the interviews, 74 percent of enterprises still reported a decrease in production levels when compared to the same time in 2019.”
The report revealed that 80 percent of enterprises reported experienced a decrease in production with a majority reporting a decline in production between 21 percent to 60 percent.
It noted that 77 percent of business enterprises reported that they either reduced working hours, or either temporarily or permanently had to lay off workers.
The findings also revealed a level of uncertainty plaguing enterprises around the country with 61 percent of enterprises expressing low confidence in relation to outlook on the future, where their perception of their capacity to operate uninterrupted, under the current circumstances, was less than one year.
