Nigeria’s unemployment rate moves up to 8.2%

… unemployment, underemployment highest among youths

Nigeria’s unemployment rate (going by the recalculated standards of 40 working hours per week), moved up to 8.2 percent in the second quarter of 2015 from 7.5 percent recorded in the first three months of the year.

The National Bureau of Statistics (NBS) reported on Sunday that the number of unemployed in Nigeria’s labour force increased by 529,923 persons or 9.58 percent between Q1 2015 and Q2 2015, resulting in an increase in the unemployment rate to its newest level of 8.2 percent.

This represents a third consecutive rise in the unemployment rate since Q3 2014, when 6 percent was recorded.

NBS new methodology defines unemployment as the number of people who were actively looking for work but could not find work for at least 20 hours during the reference period to the total currently active (labour force) population. 40 working hours was previously used in the old calculations.

Underemployment however counts those who work less than full time, which is 40 hours, but work at least 20 hours on average a week and/or those who work full time but are engaged in an activity that underutilises their skills, time and educational qualifications.

The number of underemployed in the labour force during the review quarter increased by 1,362,274 or 11.16 percent, according to the Bureau, resulting in an increase in the underemployment rate to 18.3 percent (13.5m) in Q2 2015, from 16.6 percent (12.2m) in Q1 2015.

“Accordingly, there were a total of 19.6 million people between ages 15‐65 either unemployed or underemployed in the labour force in Q2 2015, compared to 17.7 million in Q1 2015,” the NBS said in its unemployment/underemployment watch.

But unemployment and underemployment were highest for persons in the labour force between the ages of 15‐24 and 25‐34, which represents the youth population in the labour force.

According to NBS figures, Nigeria’s economically active population or working age population (persons within ages 15‐ 64) increased from 102.8 million in Q1 2015 to 103.5 million in Q2 2015.

The labour force population (those within the working age population willing, able and actively looking for work) increased to 74 million from 73.4 million in Q1 2015, representing an increase in the labour force by 0.81 percent.

“This means 574,498 economically active persons within 15‐64 entered the labour force i.e. were able and willing and actively looking for work between April 1 and June 30, 2015,” the NBS further noted.

Within the same period, the total number in full employment (did something for at least 40 hours) decreased by 1,317,700 or ‐2.37 percent.

The federal data office said the drop in number of full employment, i.e., those working less than 40 hours despite a rise in the labour force could be attributed more to job losses or previously fully employed persons choosing or being forced to work part time or in underemployment.

Further analysis indicates that with an economically active or working age population of 103.5 million and labour force population of 74.0mn, 29.5 million persons within the economically active or working age population decided not to work for various reasons in Q2 2015, compared with 29.3 million in Q1 2015.

 The unemployment rate within the review period was highest for those within the ages of 15‐24 (14.9% in Q1 2015, up from 13.7% in Q1 2015), while the underemployment rate for those within the ages 15‐24 rose to 33.8 percent from 30.6 percent in Q1 2015.

For those in the labour force within the ages of 25‐34, however, unemployment rose to 8.9 percent in Q2 2015 from 8.2 percent in Q1 2015 and 6.9 percent in Q4 2014, while underemployment stood at 19.5 percent from 17.7 percent in Q1 2015 and 19.0 percent in Q4 2014.

“Accordingly, 48.7 percent of Nigerians in the labour force (not entire population) aged 15‐24 were either unemployed or underemployed in Q2 2015 compared to 44.3 percent in Q1 2015, while another 28.4 percent aged 25‐34 were either unemployed or underemployed in Q2 2015, compared to 25.9 percent in Q1 2015,” NBS explained further.

Nigeria, Africa’s largest economy, still boasts of about 1.8 million new entrants into the job market annually, in addition to the existing 5.7 million job gap.