Kaye Whiteman
The recent efforts by the national economic management team to intervene in job creation is very commendable. Equally laudable is the call for inputs from the public on workable job creation strategy for various sectors and for the country as a whole. Escalating this disquieting national problem to appropriate strategic crescendo has become timely and calls to question the ministry of Labour and Productivity as well as the National Directorate of Employment’s capacity to meet the public’s expectations in this respect. For several years, both agencies seem to be at a loss on what to do about the burgeoning unemployment size. Now a target 12,000,000 new jobs is set to be achieved now!
But this number though a very good start seems to play down the size of the unemployed in the country. The NBS estimated that national unemployment rate was 19.7% by March 2009. This puts us ahead of countries such as South Africa and Spain but in worse position than a country such as Sudan! If this estimate is however reliable, then it means that the number of the unemployed should be in the neighbourhood of 20,000,000 and not 12,000,000 thus leaving a gap of about 8,000,000 in the resumed problem-resolution initiative. By definition, unemployment rate is the proportion of Labour Force who were available for work but did not work in the week preceding the survey period for at least 39 hours. The Total Labour Force in turn is made up of all persons aged 15 – 64 years excluding students, home-keepers, retired persons and stay-at-home parents, and persons unable to work or not interested in work. In order to arrive at our rough estimates we took the population size of those between the ages of 9 and 59 years by 2006 (i.e. the census year) and apply the 19.7% rate after adjusting for deaths and net migration effects. The result was approximately 18,000,000 unemployed persons.
But recall that in 2006, economic activity level was much higher and it was much easier for those willing to get work to do so than it is now. When adjustments that consider these realities are made to the data across the four year period from 2006, we arrive at our rough estimate of 20,000,000 unemployed persons.
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It is extremely pathetic that a country which boasts of huge natural resources with massive annual fiscal spending will allow over 20,000,0000 of its inhabitants (not counting the tens of millions of other very helpless dependents) to be without jobs. We know how to strategically channel our massive yearly fiscal spending into people’s pockets but rarely consider job creation as a strategic necessity. More of the budget spending are channeled to an ever-growing recurrent spending that support an over-bloated bureaucracy. That notwithstanding, the fiscal regimes on yearly basis have suffocated the growth and stability of newly-starting and old firms through varieties of taxes, excise and customs duties etc. Thirdly, fiscal spending allocations meant for critical infrastructure are either embezzled or when seemingly deployed are substandard and lasts only for very short period. To cap it all, the monetary policy programmes have been accommodating of the many years of fiscal deficits that provided these funds with very destabilizing impacts on economic prices and overall stability of the macroeconomic environment. This accommodation culture has not stopped contrary to the position of the CBN.
The litany of causes can continue. What is important to note here is the fact that the high level of unemployment in the country is caused by the government itself through its misguided policies, kid-glove treatment of official corruption and out of sheer neglect of the need to strategically target employment creation as a measure of its performance. Characteristic of government, efforts have been made to push the sources of this massive unemployment to a widespread liking for white collar job as well as the unemployability of school graduates. Both arguments hold little water and are meant to put veil on the truth and away from the government which indeed is the true cause. With the oil boom the public service sector was massively blown up in our typical self-deluding manner. This created a phony employment structure typical of countries that are in more advanced levels of economic development.
Generally, a high percentage of the population of economies at the basic stages of development are oftentimes engaged in primary employment. The ensuing employment structure at the national aggregate level are dominated by the predominance of agricultural occupation. With the development of industrial bases, the secondary sector emerges and develops. Increasing mechanization reduces the quantum of direct human labour engagement and consequently catalyzes migration to urban areas to get factory jobs. At the tertiary level, the demand for services increases further. Here computers, machinery and robots replace people in the secondary sector. In the case of Nigeria, very inappropriate fiscal programmes continuously distorted the supposed natural evolution in the structure of employment from a primary to secondary sector dominance which unfortunately have grave implications for sustainable development of this country. The most obvious consequence is the mass of the unemployed. The unemployability dimension is equally anchored on Nigerian government’s poor funding of education which is less than 1% of Gross National Income and thus the least in global ranking. Similarly, the Global Competitiveness Report scored the quality of Nigeria’s primary education and the quality of the overall educational system 37.1% and 54.3% respectively. With terrible primary education it is not difficult to guess the quality of education that will follow at higher levels all of which are factors in the chances of employment.
Agriculture and solid minerals exploitation still hold the ace for this economy if it is truly interested in considerably trimming the massive unemployment size. Combined with good infrastructure and education, it will provide Nigeria with distinctive economic advantages and rapid maturity into a knowledge economy as diversification into that sectors will enable further research and innovation along those lines.
Accordingly, our fiscal programmes should strongly provide incentives for investors in basic agriculture and agro-processing activities. In the same way, policies must be fine-tuned as regularly as is necessary in order to ensure that they do not unduly hurt existing businesses. Employment prospects exist when entrepreneurs believe that the future of their businesses are bright and will result in profitability. When policies on the contrary heighten instability and uncertainty levels, the entrepreneur consequently more conservatively adjusts his expectations of the future and acts accordingly by reducing various factor employments. In the hands of God we commit our dear Nigeria!
