The National Bureau of Statistics (NBS) has said that Nigeria’s unemployment rate dropped drastically from 33.3 per cent in the fourth quarter of 2020 to 4.1 per cent in the first quarter of 2023.
The new report released by the NBS yesterday, showed that unemployment stood at 5.3 per cent in Q4 2022 and 4.1 per cent in Q1 2023.
However, experts have dismissed the new unemployment figures and the methodology employed by the NBS in determining the level of unemployment and underemployment in Nigeria, describing it as an act deliberately antithetical to Nigeria’s realities.
The NBS justified the new report saying it aligns with the rates in other developing countries where work, even if only for a few hours and in low-productivity jobs, is essential to make ends meet, particularly in the absence of any social protection for the unemployed.
22.3 per cent of the working-age population were out of labour force in Q4 2022, while it was 20.1 per cent in Q1, 2023.
Nigeria and many Nigerians have been battling a high volume of unemployment as many companies cut jobs and reduce wages to meet prevailing economic volatilities.
President/chairman of the governing council of the Nigerian Association of Small and Medium Enterprises (NASME) Abdulrasid Yarima had said about 10 percent of the 40 million Micro, Small and Medium Enterprises (MSMEs) in the country have shut down since the federal government removed subsidy on petrol.
The likes of ShopRite, Procter & Gamble, Surest Foam Limited, Mufex, Framan Industries, MZM Continental, Nipol Industries, Moak Industries, Deli Foods, and Stone Industries, among others, have shut down fully or partially in the past five years.
But the NBS report claims that the rate of informal employment among the employed Nigerians was 93.5 per cent in Q4 2022 and 92.6 per cent in Q1 2023.
Statistician-general of the federation Adeyemi Adeniran said the results indicates a scarcity of wage-employment, as the share of those employed in Wage-employment during the reference quarters was 13.4 per cent in Q4 2022 and 11.8 percent in Q1 2023.
In Q4 2022, 2.6% were engaged as Apprentices/Interns and 2.2 per cent in Q1, 2023.
A further 10.7 per cent in Q4 2022 and 10.6% in Q1 2023 were engaged helping (without pay or profit) in a household business.
NBS said most Nigerians operate their own businesses or engaged in farming activities as an alternative source of livelihood. The shares are 73.1 per cent and 75.4 per cent in Q4 2022 and Q1 2023 respectively.
Nigeria’s high cost of production was N788. 7 billion in 2022 as against N630.7 billion in the first half of 2021, according to reports, making imported products cheaper than locally produced goods.
“Underemployment rate which is a share of employed people working less than 40 hours per week and declaring themselves willing and available to work more was 13.7 per cent in Q4 2022 and 12.2% in Q1 2023,” NBS said in the labour force statistics report.
The share of wage employment was 13.4 per cent in Q4 2022 and 11.8 per cent in Q1 2023.
About one-third (36.4 per cent in Q4 2022 and 33.2 per cent in Q1 2023) of employed persons worked less than 40 hours per week in both quarters. This was most common among women, individuals with lower levels of education, young people, and those living in rural areas.
About three-quarters of working-age Nigerians were employed–73.6 per cent in Q4 2022 and 76.7 per cent in Q1 2023. This shows that most people were engaged in some type of jobs for at least one hour in a week, for pay or profit
The results presented in this report are for the reference periods of Q4 2022 and Q1 2023, the bureau statistics said yesterday.
The share of the working age population in Nigeria that are not working was 21.4 per cent in the fourth quarter of 2023 and 19.8 per cent in the first quarter of 2023.
Speaking on the development, professor of Capital Market at Nasarawa State University, Uche Uwaleke in reaction to the report said the 4.1 per cent unemployment figure does not reflect the true situation on ground owing to a number of reasons including the low sample size of under 40,000 persons used in the survey as well as the adoption of the International Labour Organisation guidelines for employment computation which considers employment from the perspective of persons of working age who are engaged in some type of jobs for at least one hour in a week for pay or profit.
“Compared to the old methodology adopted by the NBS, this new methodology which includes apprentices, is tantamount to significantly lowering the bar and could lead to wrong policy decisions by the government.
“Much as the ILO guidelines provides a basis for global comparison, it is important that Nigeria adopts country-specific guidelines which closely reflect unique employment conditions prevalent in the country,” Professor said in reaction yesterday.
Also, the Centre for Social Justice (CSJ) rejected the NBS report, arguing that it is not supported by the increasing unemployment in Nigeria since the last report in 2020 which puts Nigeria’s unemployment rate at 33.3 percent. Since 2020, Nigeria’s economic challenges have increased with galloping inflation, factory closures, rural dwellers who have been prevented by insecurity from planting and harvesting and a public sector with a moratorium on new recruitments.
“The whole basis of a job report is to help the government to determine whether its plans, policies and laws geared at reducing unemployment are achieving the desired milestones,” lead director of CSJ, Eze Onyekpere said. “What is the point of a job report that tells the government that more Nigerians are employed when it is a clear and notorious fact that unemployment is increasing?”
“The NBS is counting people who are working for at least one hour in a week or who are self-employed in low-productivity activities as ‘employed,’” said Onyekpere. “This is not an accurate reflection of the reality of the Nigerian labor market.” “Simply to satisfy a fad, it is a waste of tax payers money to produce a report that adds no value to the Nigerian people and their economy”. CSJ believes that these statistics do not in any way reflect the prevailing economic challenges experienced by Nigerians, especially in recent times.
Before today’s report, Nigeria’s last unemployment data was released in the fourth quarter of 2020, leaving a substantial gap in our understanding of the employment situation. CSJ previously emphasized the urgency for the NBS to provide up-to-date employment data for the years 2021 and 2022.
“This reported rate is incongruent with the economic challenges faced by a significant percentage of the population.
“We call on the NBS to reconsider its methodology and ensure that it accurately captures the full spectrum of employment challenges faced by Nigerians. It is essential that job reports reflect the realities and provide an honest assessment of the economic landscape. Only through accurate data can the government develop effective strategies that deliver on its promises and address the pressing issues facing our nation,” Onyekpere said.
CSJ also called on the government to ignore the report, take steps to create more decent jobs and to improve the livelihoods of Nigerians.
