• Saturday, July 13, 2024
businessday logo


Why unemployment problem must be addressed to boost wealth creation

Why unemployment problem must be addressed to boost wealth creation

The National Bureau of Statistics (NBS) reported that unemployment rate in the nation stood at 33.3 per cent in Q4 2020. The problems of underemployment and youth unemployment are equally challenging as their rate were 22.8 per cent and 42.5 per cent respectively during the same quarter. This has made Nigeria as one of the countries with the highest number of unemployed people. In Q2 2020, Nigeria’s unemployment rate was 27 per cent.

Nigeria is Africa’s largest economy and is a niche for profitable businesses across the continent in various economic and business sectors. Undoubtedly, the country is blessed with so many natural and human resources to sustain its large population, it has not hit a standard of a forward looking nation having a significant portion of its labour force engaged.

According to Statista, Nigeria had the highest Gross Domestic Product (GDP) in Africa in 2021, amounting to $514 billion, but it is still a middle-lower income economy, with much of the growth coming from agriculture and telecoms, supported by revenue from the sales of crude oil.
The United States Bureau of Labour Statistics (BLS) has stated when workers are unemployed, their families lose wages, and in turn, the nation loses the individual’s contribution to the economy in terms of goods, services and innovation that could have been purchased and produced by them.
One of the governors of the largest states in the nation, Abdullahi Ganduje of Kano State revealed that the state possesses up to 3.4 million out-of-school children. This number is appalling and threatening to the upward growth of the nation.

The number of unemployed youth is likely to increase going by the fact that some school children in states within the northern part of the nation are currently out of school due to the worsening insecurity. These children cannot learn employment enhancing skills.
The unemployment problem became a major challenge from the end of Q2 2020 when the number of able-bodied Nigerians who were willing but could not get jobs increased to 36.59 million. Compared to Q3 2018, it means 11.6 million Nigerians were unemployed in 21 months during the period. This translated to 550,329 Nigerians unable to get jobs on a monthly basis.
Fast forward to Q4 2020, the number of unemployed Nigerians rose to 52.4 million, according to the National Bureau of Statistics (NBS). By implication, in just six months (Q2 to Q4 2020), 15.8 million Nigerians were unemployed in the labour market. This translated to an average of unemployed Nigerians at 2.6 million per month.

Read also: Rate of Job creation insufficient to tame Unemployment in Nigeria

The rising unemployment is having a serious impact on the quality of manpower available in this country. We have seen in recent times where hundreds of medical doctors migrated from Nigeria to other more developed countries.
Also, within Nigeria, there is an increasing rate of migrating citizens from the northern region to the southern part due to the high level of insecurity and life-threatening events. In urban areas like Apapa, Mile 12, Ikeja located in West Africa’s commercial capital, Lagos, you could see the presence of migrants who might have been displaced by the wars. Most of them earn a living as motorcycle riders.
Statista also reported that the Nigerian government created 750,000 new jobs recently. That announcement was made to the public by Dasuki Arabi, the director-general, Bureau of Public Service Reforms. He stated that this action by the federal government was birthed from some research works which were carried out in conjunction with the Nigerian Economic Summit Group.
The Ministry of Humanitarian Affairs was created to assist the unemployed people. Arabi added that the government was working with the Central Bank of Nigeria and SMEDAN to provide some form of assistance to the unemployed Nigerians. He also said the government would soon introduce entrepreneurship to primary and secondary schools, as well as other tertiary institutions. He also stated that the government was putting measures in place which will help the private sector thrive and become better employer of labour, thereby supporting the government’s efforts towards job creation.

The unemployed in Nigeria especially the youth are availing themselves of any legitimate opportunities to make a living. According to Statcounter Global Stats in 2020, there was a spike in the use of social digital applications such as Twitter, Instagram and YouTube. They have become basic platforms used especially by youth for trading of various items. However, these activities are more popular in urban areas where more educated people use the platforms. Another brand of skill which has become popular amongst youth, both employed, unemployed and underemployed is affiliate marketing where a trader just has to sell goods and services that they do not necessarily own but are connected to an individual who needs such value.

Since 2020, there have been a surge in the use of social media and digital software applications by mostly the youths in Nigeria, as a way of generating income for themselves once they have the required skills. The common opportunity they seize is selling and buying legitimate items. Many have turned software applications to platforms where they can buy and sell in order to earn up a living or keep themselves busy while looking out for job opportunities. This is more rampart in the urban areas like Lagos, Ibadan, Benin city, the federal capital, and a few more states.