Having spent four or five years in the university obtaining a higher degree, on some level, most Nigerian youths; even those that get jobs at the first time of asking, struggle with the thought of being unemployed. The unemployment rate is perceived as really high compared to what it actually is because you can easily list 10 classmates, friends, or relatives that are unemployed. I conducted a small survey among friends, asking them to place a number on the unemployment rate in the country, and the range of the perceived unemployment rate from my survey was between 30% and 65%, with the high variation pointing to the markedly different opinions people have about it, depending on who you talk to.
The actual unemployment rate in the country is a lot lower than what we perceive. Let me shock you a bit here; according to the National Bureau of Statistics, the unemployment rate in Nigeria at the end of the third quarter in 2017 was 18.8%!
Now I stop short of saying “just 18.8%” because the value was even lower before the recession at 13.9%. Although unemployment is on the rise in Nigeria, it is nowhere near the levels people think. So what is the nature of this unemployment?
Nature of Unemployment in Nigeria
It is not news that unemployment is as a result of a larger labour force than there are jobs. However, within this simple relationship, you have two scenarios;
- The number of jobs in the country is at a constant
- The number of jobs in the country is fluctuating
Nigeria’s situation is the former. There have been various news reports stating that the federal government was empowering Nigerians, creating new jobs and that jobs were being created as a result of Foreign Direct Investment. While there is truth in these, as the jobs are being created, some are being destroyed as we also hear in the news that companies and organizations are downsizing and laying off workers. This job creation and destruction dynamic has pegged the number of jobs in Nigeria to a relatively constant level.
As seen in the chart, the total employment or jobs between 2010, and 2017 remained fairly constant. The number of jobs only rose between 2013 and 2015 during a period of relative economic prosperity.
In the size of workforce and jobs available relationship, we also find that the population of the labour force continued to increase each year. Although recession reduced the number of jobs available, it did not do so by as much as was perceived. The combination of fewer jobs; particularly for new entrants in the labour force, and a larger workforce comprising many new entrants has led to the high unemployment.
It can be noticed from the employment chart on the left that when employment data in 2017 is compared to that in 2015, the age group 15-24 suffered the most as over 1.4 million jobs were lost in this category. This along with the fact that new entrants into the labour market are youths shows why youth unemployment is quite high.
Link Between Education And Employment
Higher Education has taken on a special significance in Nigeria that it is now considered a value. This came as a result of colonialism which planted the corporate culture in Nigeria. People that held high offices or glamorous professions were either whites or well educated Nigerians. As such, uneducated Nigerian parents sought that kind of lifestyle for their children, leading to higher education being emphasized across all generations since then irrespective of the natural inclinations of individuals.
Enough of the story, let’s see how education relates to employment. Below is a chart showing the relationship between levels of education and employment.
A salient point to note from the chart above is that the types of jobs most sought after; post-secondary employment is about the least available. In 2017, post-secondary employment made up only 12.8% of all employment opportunities at about 6.7 million jobs. Another thing to note is that the number of jobs in the post-secondary category across all years is more or less the same irrespective of whether the economy is bullish or bearish. This constancy in the number of jobs implies high competition in the post-secondary education category.
What Does The Future Hold?
Although the unemployment situation in Nigeria is not as bad as people think or make it out to be, we are still in trying times as the population of the labour force continues to increase. Below is a forecast which projects an increase in employed persons for 2018.
On this note, we can expect to have more people employed in the labour market. So unemployment is not the beast we supposed it to be.