What you Need to Know about Job Creation and Unemployment in Nigeria

The Services and Agricultural sectors generate the highest number of jobs in Nigeria. Agriculture was the highest employer of labor until 2006 when Services took over.

The total number of people able to work in Nigeria (aka the labor force) is between 61 to 90 million, as at 2018. Out of this number, the World Bank estimates that only 4 million people are unemployed, but the National Bureau of Statistics (NBS) estimates that 21 million people are unemployed. Different estimates by different institutions– but the NBS data seems closer to reality

For those employed, about 38.5% are employed in Agriculture, 11.5% are employed in Industry, and 50% are employed in Services (based on 2010-2018 employment average). While job creation has been growing by around 2% each year, the number of people seeking employment is growing by around 4% each year – resulting in high unemployment rate in the country.

Why the lack of jobs? There are so many reasons including:

  • High population growth/birth rate,

  • Low quality education - that often does not meet the needs of sectors and companies,

  • Too much focus on oil money/industry (which doesn’t create as much jobs as other industries) – it is not surprising that oil-producing states like Akwa Ibom, Rivers and Bayelsa have the highest unemployment rate [see Graph].

What is required? To reduce unemployment in the country, PWC estimates that employment should grow by at least 4-5% annually to match the number of people joining the labor force each year. This would mean creating above 3 million new jobs every year –but we are only doing half of that.

Where can we create the new jobs required? All things being equal, sectors and product lines that are highly labor-intensive and require low-to-medium skill level have the highest potential for creating new jobs for Nigeria’s growing labor force. Note that: nearly half of Nigeria's labor force population has less than a primary school education.

In each sector, key product lines that have the highest potential to absorb millions of people from the labor force include:

In Agriculture: Sorghum; Millet; Beans; Maize; and Cassava.

In Industry: Food processing; Textile, apparel and footwear; and Construction/Real Estate

In Services: Retail & Wholesale Trade; Telecommunications; and Financial Services/Banking

Out of all these sectors, Services has the greatest potential.

For the government to tap into this potentials, they need to:

  • Improve the ease of doing business (e.g. create infrastructure like electricity and transport that ease business burdens)

  • Sustain macroeconomic stability (e.g. keep inflation low and stable, and ensure peace in the country)

  • Attract investments (e.g. create policies that make people and companies both home and abroad want to invest in Nigeria)

  • Develop human capital (e.g. increase investment to create quality education system and curriculum that match realities on ground).

India also tapped into the services sector and it made all the difference in their national employment, Nigeria can do the same.


Still Craving? Read more on: World Bank and PWC

Article Credit: Precious C. Akanonu (Editorial)

#Nigeria #Jobs #Employment #Agriculture #Industry #Services

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