The National Bureau of Statistics (NBS) has recently disclosed that, according to a novel methodology, a significant 76.7 percent of Nigerians were employed during the first quarter of 2023. Additionally, the NBS noted a notable reduction in Nigeria’s unemployment rate, which plummeted from 33.3 percent in the fourth quarter of 2020 to a mere 4.1 percent in the same quarter this year.
This significant shift in unemployment figures was attributed to the NBS’s implementation of a fresh approach in conducting the Nigeria Labour Force Survey (NLFS). During the launch of this revamped methodology, Prince Adeyemi Adeniran, the Statistician General of the Federation, elucidated that the alteration was the result of a subtle but impactful shift in the criteria defining employed individuals. The new criteria categorize individuals as employed if they have participated in at least one hour of work within the past seven days of the survey, in contrast to the prior criterion of 20 hours under the old 13th ICLS methodology established in 1982.
The updated methodology brings Nigeria’s Labour Survey in alignment with international standards, a methodology already adopted by neighboring countries such as Niger, Benin, Cameroon, Chad, and Ghana.
A key facet of the report highlighted that 11.8 percent of the workforce was engaged in wage employment, whereas the majority of Nigerians (75.4 percent) were involved in entrepreneurial pursuits or agricultural activities. Additionally, the report drew attention to the fact that approximately one-third (33.2 percent) of employed individuals worked less than 40 hours per week, a trend more prominent among women, individuals with lower education levels, youth, and those residing in rural areas.
The concept of underemployment, defined as individuals working less than 40 hours per week yet expressing willingness and availability to work more, was also examined, registering at 12.2 percent. The report further pointed out that informal employment, encompassing agriculture, constituted a substantial 92.6 percent of employed Nigerians.
It was revealed that individuals with post-secondary education exhibited the highest likelihood of employment, whereas individuals aged 15-24 years and those aged 65 years and above were less likely to secure employment. Urban areas reported a lower likelihood of employment in comparison to rural regions.
In response to the findings, Atiku Bagudu, the Minister for Budget and Economic Planning, underscored the necessity for the government to intensify its efforts in generating employment opportunities for graduates, given the 12 percent wage employment rate.
Senior economist at SPM Professionals, Paul Alaje, offered insights into the reduction of unemployment figures driven by the new methodology. Alaje highlighted that while unemployment figures decreased significantly, the quality of the available jobs might not correspond to the capacity or skillsets of job seekers. He emphasized that individuals holding advanced degrees possess the potential for more substantial contributions, an aspect that the government will need to address.
This reduction in unemployment, according to Alaje, does not solely reflect the government’s policy interventions or the private sector’s job creation efforts. Rather, it underscores the existing incongruity between available jobs and the capabilities of the workforce.
