Understanding and tackling rising unemployment in Nigeria, by Adefolarin A. Olamilekan

Understanding and tackling rising unemployment in Nigeria, by Adefolarin A. Olamilekan

Arguably, economists are often in disagreement on what policy measures should be adopted to reduce unemployment in any nation.

Many times the disagreements are not on the policies per se but squarely on the implantation of any kind of policy meant to tackle unemployment.

I am tempted to say the foregoing because lots of brilliant ideas on how best to tackle unemployment are deliberately being frustrated when it comes to implementation.

Meanwhile, empirical evidence abounds globally on successful measures taken by developed nations to overcome unemployment issues, even though it may not have been completely eliminated, but meaningful, and it may not be as bad as we experience it in our clime.

For instance, the Asian tigers and the Asian combs have understood that tackling unemployment requires the government to deliberately participate in vital economic sectors and sub-sectors.

The Chinese government have practically demonstrated this by not leaving out the issue of employment creation in the hands of private sectors alone, rather the government having a stake in all business enterprises is a matter of ensuring Chinese citizens are gainfully employed.

That is why no serious government should slack on issues of employment, essentially, because the private sector many regard as the apex centre for employment creation is part and parcel of an economic system that promotes profit maximization, so, they may never be too passionate about reducing unemployment. Arguably because they are after cost-cutting for business expansion and growth, one cardinal focus of global capitalism.

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Unequivocally, unemployment is a global challenge, and one factor fuelling it naturally is the profit greed of oil global capitalism. It is a fact that many are yet to understand how this happened, but we must not allow that to rob us and neglect the essence of why every man and woman must get a sustainable livelihood. The reason is that unemployment is an economic crisis that increases poverty, hunger and anger on a daily basis.

A look at the sub-Saharan African countries is a testament to this reality, a situation where the rate of unemployment in the region is discomforting to the economy.

Sadly, l don’t want to be too technical in this piece by quoting figures that keep changing every minute signifying we are in a dangerous situation, which reflects the region’s citizens’ quality of life and insecurity circumstances, and partly driven by millions of unemployed persons, who are anxiously struggling to earn and eat.

Again, l am persuaded to bring on some of these issues, knowing fully well that one of the biggest challenges we face in Nigeria is unemployment, which successful governments in the past promised to tackle through brilliant paper proposals, memos and to a greater extent act of parliament, remained a mirage till date.

In this, wise one cannot but query why is the government failing to address unemployment in Nigeria and when the election comes it is one aspect politicians tell us they have a magic to solve once they are in government. Just like the current government led by President Tinubu also promises to create jobs that would eventually reduce the ranks of unemployed Nigerians.

I don’t want to reiterate the question of how would President Bola Ahmed Tinubu turn the situation around because, in his 88 pages of Renewed Hope Agenda campaign manifesto, he outlines it there.

But l am convinced the president and his economic team must have realized that there is a difference between an economic paper proposal and the actual implementation in real life.

This now brings us to a recent National Bureau of Statistics (NBS) report that detailed the drop of the country’s unemployment rate to 4.1 per cent in the first quarter (Q1) of 2023, from 5.3 per cent recorded in the previous quarter. The report stated that about three-quarters of working-age Nigerians were employed – 73.6 per cent in Q4 2022 and 76.7 per cent in Q1 2023.

However, NBS said the unemployment report adopted a new methodology and presented an in-depth analysis of the labour market compared to the previous methodology that had always been used.

Especially as the employment definition according to NBS is any “labour for profit done for even an hour in seven days, as well as defining employed persons as individuals who are working for pay or profit and who worked for at least one hour in the last seven days against 40 hours”.

Critically the report was greeted with miss feeling from many quarters, in as much as the statistics bureau made it clear that the ” new methodology and the latest figure was not to give the new government a good face but to bring up the method used to conduct labour surveys in the country”

Therefore, this is notably in line with the International Labour Organisation (ILO’s) guideline, that is not the outcome of the generation of new jobs, but a redefinition of the term unemployment in recognition of key labour markets indicators such as employment, including unemployment rates, underemployment rates, hours worked, and informal employment as suggested by World Bank and the International Labour Organisation, and adopted by 26 countries in Africa which includes Ghana, Niger, Chad, Cameroon, Benin, Gambia, etc.

We indeed appreciate the NBS report as it reminds us we don’t have to solve the problem technically because technicality only points to the symptoms but not the root causes. Again, technicality also meant we would just continue to maintain the official status quo in a narrow sense without being critical of it.

Regrettably, a lot of brilliant political economists and other economists have sacrificed their critical minds by ensuring their take is to make the technical status quo more efficient or else they would end in misery and poverty.

As one leading comrade once told me, “Critical economist won’t get a job easily, because there are no Marxist or socialist jobs in government or organized Private Sector (OPS).

And this is true, even the labour unions that would have provided shelter for such are turning them away, not to mention the hostile environment in our academic against heterodox intellectuals, is a sad reality we live in, that would make the likes of late Prof. Bade Onimode, Prof. Claude Ake, Prof Esko Toyo and Henry Boyo turn in their grave.

Now back to the cross of this piece, our government is yet to grasp how the structural deficit in the nation’s economy underscores the unemployment crisis.

However, we acknowledge the facts the issue of unemployment and how best to tackle it remains a challenge for the Nigerian state since 1999, have been formulating and implementing policies to reverse unemployment in the country. Their efforts have led to the creation of different agencies, institutions and ad-hoc programmes to tackle the menace of unemployment in our country.

In the same light, the government established financial institutions such as the Development Bank of Nigeria (DBN), Bank of Industry (BoI), Development Commissions and related institutions like the Small Medium Enterprises Development Agency of Nigeria (SMEDAN) alongside ad-hoc programmes in the likes of YouWin, N-Power, Graduates Internship Programme as a way of generating employment from a public-private spectrum.

Painfully, there seems to be no headway because the government has failed to understand that the root cause of unemployment is tied practically to the deficit nature of the economy.

The most disappointing aspect is were, the government is playing politics with the issue of employment generation by seeking a quick-fix approach through ad hoc programs, cosmetic policy that through money at job creation and implementing policy of employment creation from the prism of formal government recruitment into public and civil services and this in particular is area most Nigerians see as the only employment with security.

For us, the recent employment data released by the NBS further points to the failure of the Nigerian state to reduce the widening gap in the number of Nigerians who are out of jobs.

It is a clarion call on the Tinubu administration to approach the issue of unemployment with renewed zeal as it seeks to renew the hope of millions of Nigerians who are gradually losing hope in the government’s ability to turn the economy around.

This requires a short to medium-term basis that mandates the government to stop wasting scarce resources on cosmetic ad hoc job creation.

Another is for the government to strengthen the various agencies saddled with the responsibility of enhancing self-employment creation and complementing the private sector job creation drive. In this regard, the likes of SMEDAN, NPC, DBN, BOi and Bank of Agriculture should be supported adequately and monitored effectively.

In addition, we hope to see Tinubu’s government carry out an audit on the number of employed Nigerians in all federal government agencies and institutions, to ascertain the number of workers due for retirement, the underemployed status of some agencies and skills gaps.

We will not fail to mention that the government should not foreclose revitalisation of the government-owned enterprises and not shy away from creating new ones as better means to participate in the economy and reinvigorate the spirit of providing affordable and accessible goods and services to Nigerians.

Meanwhile on a long-term basis is addressing the challenges faced in the business environment that militate against the private sector employing Nigerians.

Here, the concern has been the cost of operations within the Nigerian business ecosystem.

The complaints against the business environment are issues of high energy cost, deplorable road conditions that affect goods and services, logistics, absence of required quality technical skills, and insecurity amongst others.

Again, Tinubu’s administration must prioritise issues around technical human capacity development by looking to leverage science, technology and innovation to tackle unemployment.

We have grasped the aspect of ICT, but the field of scientific and technological space could help us take advantage of sectors like mining, steel, metallurgy, and other mineral resources into finished products for local use and export, along with insecurity which is also a driving factor of unemployment, it is pertinent that the present administration takes proactive measures to change the narrative as the past government failed.

Adefolarin A. Olamilekan is a Political Economist. Tel: 08107407870
Email: adefolarin77@gmail.com