The alarm over unemployment
Unemployment may be a global problem but Nigeria is having more than her fair share of it. With the grim figures released some time ago by the National Bureau of Statistics (NBS) which stated that the country’s unemployment rate rose from 13.3 per cent in the second quarter of 2016 to 13.9 per cent in third quarter, the situation would seem to have been compounded by the raging recession and Nigeria now sits on a tinder box as far as unemployment is concerned. Indeed, the World Economic Forum (WEF) reports that the country’s misery index has reached 50 per cent, meaning that more than half of Nigeria’s more than 180 million people “are miserable.” The Misery Index is a measure of unemployment in line with inflation rate the average rate of increase in prices of goods and services. The global body opines that gross unemployment rate when considered with under-employment rate in the third quarter of last year for example, puts the unemployment rate at 50 per cent. This magnitude of unemployment, especially among the youth, according to WEF, is deplorable, and should be a cause for concern because of its consequences. The rising rate of unemployment will enlarge the existing risk of insecurity and militancy in major parts of the country and undermine government’s efforts at fighting insurgency in the Northeast, uprisings in the Southeast and other serious crimes in other parts of the country.
What is responsible for the alarming rate of unemployment? Poor infrastructure, governments tariff, stagnation in the real sector due to a hostile investment climate, general business depression in the private sector, poor quality and dysfunctional educational system that has created an army of unemployable graduates, population growth, neglect of the agric sector, migration from rural to urban areas, ethnicity, corruption and abandoned construction projects amongst others are causes. Also, looking at artisans and the real sector, the problem of poor infrastructure, particularly poor electricity supply, poor road network, inadequate physical security and the high cost of finance are some of the factors that render artisans jobless. These all combine to make the real sector produce below capacity. Emphasis on university education at the expense of technical and vocational education that can produce a skilled work force, population explosion and expansion of the formal education system without a corresponding provision for absorption into the workforce are also to blame.
Available statistics reveal that in recent years, about 150 multinational industries have divested from the Nigerian economy. Many more are considering pulling out of Nigeria. With government’s tariff, some companies are finding it difficult to produce locally as it is more lucrative to import and market many products.
Again, many of the cottage industries are practically dead and a lot of medium and small scale enterprises often described as the real engine for job creation have been folding up. The textile industry with over 200 firms has largely closed shop. Also, the hike in the price of cement and other building materials and abandoned construction projects which are the traditional employment creation avenues particularly during depression, are not helping matters.
To forestall further increase in the rate of unemployment government should concern itself with the promotion of policies and institutions that can improve opportunities and capabilities for Nigerians, while reducing vulnerabilities. Also, it should give incentives to private sector employers such as tax holidays. Attention should be paid to those young ones leaving school with no or poor qualifications. Even those leaving with top grades should be trained to fit into the labour market. As such, curriculum must be revised for multiple skills and entrepreneurial skills. Industrial training must be encouraged for as many courses as possible to improve the employment prospects of young graduates.
Reviving the agric sector has become inevitable as exemplified by the Anchor Borrowers’ Programme of the present government, where the Central Bank of Nigeria has set aside N40 billion for farmers at single digit interest rate of nine per cent. The initiative which is aimed at assisting rural agropreneurs’ move from subsistence to commercial production is most commendable. However, the arising gains should be maximized through policy consistency. Thus, the government should not only concentrate on production, but also improve other aspects of the agricultural value chain such as storage, processing and market development.