In an insightful piece, Efosa Ojomo and Sandy Sanchez described Nigeria as a country of “largests.” The country has the largest economy in Africa, has the continent’s largest population, is Africa’s largest oil exporter, and, sadly, has a large number of multidimensionally poor people. With inflation at a staggering rate of 28.20%, as reported by the National Bureau of Statistics in November 2023, citizens are struggling with an increase in the price of essential items amidst deficient access to essential amenities such as good roads, electricity, security, and other essentials on the never-ending list of what the government has failed to provide multiple times.
Anyone consistently observing the challenges faced by average Nigerians would undoubtedly anticipate a double-digit unemployment rate. Strikingly, in Q4 of 2020, Nigeria recorded an unemployment rate of 33.3%. However, the National Bureau of Statistics (NBS) recently reported surprisingly lower rates of 5.3% (Q4 2022) and 4.1% (Q1 2023). This report has become a focal point of debate, with many asserting that it inadequately represents the current conditions in the country, despite the NBS’s argument that it is based on the new Nigeria Labour Force Survey (NLFS).
This article aims to elaborate on the contemporary methodologies contributing to the disparity in the rate of unemployment, assess the few foundations upon which the rate was determined and provide valuable insights into the implications that extend beyond the seemingly positive unemployment figures.
The first attempt at defining unemployment was at the 1947 International Conference of Labour Statisticians. All persons “able to take a job if offered one, who are out of a job on a given day and have remained out of a job and seeking work for a specified minimum period not exceeding one week” were considered unemployed.
Since not all nations had embraced this concept by then, no two nations had the same definition of unemployment. In Sweden, an unemployed person was defined as “one who had less than twenty-four hours of employment in a week in his regular trade or a person working outside his regular trade whose weekly earnings were below those paid in his own trade”; in Australia, an unemployed person was defined as “one who had been out of work for three (3) days or more during a specified survey week.” Based on their preferred days or other unique characteristics, other nations likewise measured their respective unemployment rates.
In essence, the new unemployment rate cannot serve as a reliable measure of people’s well-being, as their welfare is determined by what they do rather than mere employment status.
The evolution of the unemployment definition is evident. The 1982 ICLS defined it as seeking work, available, and without work during the reference period. The 2013 ICLS broadened it to include those working for at least one hour or temporarily absent. The NBS’s recorded unemployment rates between 2020 and 2023 differ mainly due to these evolving definitions.
The NLFS aligns its definition of employment with ILO norms, considering individuals who worked for at least one hour in the past seven days as employed. Unemployed individuals actively seek paid work and are available to begin within the next two weeks or last week.
In addition, the working age group is now defined as “15 years and above,” rather than as 15–64 years old. Additionally, because they produce commodities for their consumption rather than for sale, those who practise subsistence agriculture are seen as being outside of the working-age population.
Hence, numerous questions persist. Firstly, does this rate genuinely depict a nation where over one-third of the population resides in multidimensional poverty? Secondly, should policymakers redirect their focus away from addressing unemployment, given the ostensibly low national unemployment rate?
In response to the initial inquiry, the unemployment rate inadequately reflects a nation where one-third grapples with multidimensional poverty. It will be counterintuitive for impoverished citizens to be without any means of immediate and daily survival. They would inevitably engage in activities, even if the productivity level is relatively low. This explains why “the poorest of the poor” in the country would still have something to do.
In essence, the new unemployment rate cannot serve as a reliable measure of people’s well-being, as their welfare is determined by what they do rather than mere employment status.
To enhance the understanding of the unemployment rate, the NLFS survey should consider job quality criteria. Concerns arise as the National Bureau of Statistics utilised a sample size of 35,520 households, representing around 42 million, potentially impacting the reliability of results derived from the “19th ICLS model questionnaire.”
The unemployment indicator shouldn’t lead to complacency; policymakers must prioritise meaningful employment. Rather than just creating jobs, the focus should be on quality opportunities to uplift people from poverty. Collaboration between the Ministry of Humanitarian Affairs and Poverty Alleviation and the NBS is essential for accurate data analysis and job improvement.
In conclusion, it is worth mentioning that lifting people out of poverty in Nigeria by FG can only be achieved by focusing on the four dimensions of the Nigeria Multidimensional Poverty Index which are health, education, living standard, and work and shocks, if truly we want to save the country with a large number of “working poor”.
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