The 2024 Nigeria Labour Force Survey (NLFS), released by the National Bureau of Statistics (NBS), clearly reveals a snapshot of the country’s employment trends, unemployment rates, and the composition of its workforce.
In addition, the findings provide important data that can shape policy decisions, business strategies, and socio-economic interventions. BusinessDay takes a close look at the survey and extracts ten major takeaways from the survey, each highlighting critical aspects of Nigeria’s labour market.
1. Labour force size at the end of 2023
By the close of 2023, Nigeria had a total labour force of 88.94 million people. Of these, 84.15 million were employed, resulting in an official unemployment rate of 5.39%. This low rate seems encouraging, especially when compared to previous years, but it only tells part of the story. Despite efforts to boost job creation, informal and underemployed workers remain a pressing concern in the broader economic landscape.
2. The first quarter of 2024 shows persistent underemployment
In Q1 2024, the unemployment rate slightly improved to 5.3%, but the underemployment rate stood at 10.6%. While the headline unemployment figures may appear positive, the double-digit underemployment rate is a cause for concern. It suggests that a significant portion of the workforce is engaged in low-paying, part-time, or informal jobs that don’t fully utilize their skills or offer job security.
3. Youth disengagement: 14.5% neither in education nor employment
One of the most alarming figures from the survey is that 14.5% of young Nigerians are not in education, employment, or training (NEET). This statistic paints a troubling picture of Nigeria’s future workforce. With one of the largest youth populations in the world, Nigeria’s ability to provide adequate education, training, and job opportunities for its young people is crucial. Failure to address this could lead to deeper social and economic issues down the line.
4. Impact of COVID-19 on Nigeria’s labour force
The survey highlights the severe impact the COVID-19 pandemic had on Nigeria’s workforce. In 2018, the labour force reached 90.47 million people. However, during the height of the pandemic in 2020, that number dropped to 69.68 million. Business closures, layoffs, and economic disruptions caused by the pandemic significantly shrunk the labour force, emphasizing the need for resilience in future economic strategies.
5. The labour force rebounded by 2023
By the end of 2023, the labour force had recovered to 88.94 million people out of a total working-age population of 116.60 million. Despite this rebound, many of these workers are still stuck in informal or underemployment, struggling to find stable and well-paying jobs. The large gap between the working-age population and the active labour force highlights the challenges Nigeria faces in converting its demographic potential into economic strength.
6. 27% of the workforce lacks formal education
A staggering 27% of Nigeria’s labour force had no formal education in 2023, a statistic that underscores the country’s broader challenges in education and skills development. Lack of education limits access to better-paying jobs reduces productivity and makes it difficult for workers to adapt to the rapidly changing demands of the modern economy. This also perpetuates the cycle of poverty and underemployment in many communities.
7. The informal sector remains dominant
Of the 84.15 million employed Nigerians in 2023, 92.2% were working in the informal sector, compared to 78% in formal employment. This imbalance is a long-standing issue for Nigeria. Informal sector jobs often lack job security, benefits, and regulatory oversight. For Nigeria’s economy to thrive, more focus needs to be placed on formalizing employment and providing protections for workers in the informal sector.
8. Agriculture remains the largest employer
Agriculture continues to be the backbone of Nigeria’s labour market, employing 30.1% of the workforce. Wholesale and retail follow closely at 27.5% while manufacturing accounts for 12.7% and accommodation and food services represent 7.8%. While agriculture remains vital, these figures suggest a slow diversification of the economy, with newer sectors still lagging in their ability to absorb a larger portion of the labour force.
9. The private sector drives employment
Most Nigerians are employed in the private sector, which accounts for 74.4% of the workforce, while the public sector employs just 25.6%. The private sector’s dominance highlights its critical role in driving economic activity and creating jobs. However, many private-sector jobs, particularly in the informal economy, offer low wages and limited protections, which raises concerns about job quality.
10. Urban versus rural labour distribution
Nigeria’s labour force is concentrated more in urban areas (57.7%) than in rural areas (42.3%). The urbanization trend continues to accelerate, driven by the promise of better job opportunities in cities. However, rural areas remain critical for the country’s agricultural output. Policies targeting rural development, improved infrastructure, and enhanced access to education and healthcare are essential for balanced growth and reducing the migration pressure on cities.
These key insights from this year’s Nigeria Labour Force Survey lays special emphasis on both the progress and the challenges facing the country’s workforce.
As policymakers and business leaders digest these findings, the focus must shift towards creating more inclusive and resilient employment strategies that address both rural and urban needs, support education and skills development, as well as formalize more of the labour market to ensure long-term economic stability.
