Analysts at Nigerian research firm Data Services and Resources (ADSR) Limited have highlighted three key trends in Nigeria’s unemployment rate in 2023 for businesses and policymakers to consider their implications.
This was revealed in a recent report titled “Key Highlights of Nigeria’s Unemployment Rate and Other Labor Force Statistics” released by the Managing Director of ADSR, Mr. Afolabi Olowokere.
The report examines labor force statistics, unemployment rates, and underemployment from 2016 to 2023, and employment rates from 2017 to 2023, including those sectors.
On September 24, 2024, the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) increased the Monetary Policy Rate (MPR) by 50 basis points from 26.75 per cent to 27.25 per cent. The National Bureau of Statistics (NBS) has also released two reports: “Nigeria Labor Force Survey Annual Report 2023” and “Nigeria Labor Force Statistics Report Q1 2024”.
“These reports contain a wealth of information on employment and other workforce statistics in Nigeria, which have implications for business and policy planning,” Olowokere said.
Also read: Nigeria’s unemployment crisis
NBS highlighted that Nigeria’s labor force is 88.94 million people, of whom 84.15 million are employed, with an unemployment rate of 5.39 per cent.
The highest unemployment rate was in Abia State (18.7%) and the lowest in Nasarawa State (0.5%), while the number of employees eligible for either pension or health insurance schemes was 26.3% in Nigeria. It was %.
However, in the first quarter of 2024, an unemployment rate of 5.3% and an underemployment rate of 10.6% were recorded.
The NBS report stated that “only 7.3 percent of Nigerian workers were engaged in the formal sector, and 14.5 percent of youth were not in education, employment, or training.”
total labor force statistics
Nigeria’s total labor force increased to 90.47 million people in 2018, but decreased to 69.68 million people at the peak of COVID-19 in 2020. In 2023, the labor force will be 88.94 million out of a total working age population of 116.6 million.
Of the total workforce of 88.94 million people in 2023, 27 percent have no formal education, potentially limiting employment opportunities and skills development.
Only 26 per cent have primary education, and the most common 33 per cent have secondary education, suggesting that this is a common level of attainment, but those with secondary or higher qualifications 13% had a postgraduate qualification, and only 1% had a postgraduate qualification.
Approximately 42.3 percent of Nigeria’s workforce were rural residents and 57.7 percent were urban residents.
Also read: Nigeria’s unemployment rate increases by 5.3% in Q1 2024
Labor force by age
Approximately 25.6 percent of the workforce was between 15 and 24 years old, and 22.5 percent was between 25 and 34 years old. Additionally, 22.9% were between 35 and 44 years old, 16.4% were between 45 and 54 years old, 8.1% were between 55 and 64 years old, and 4.6% were over 65 years old.
unemployment rate
Nigeria’s unemployment rate rose from 14.2% in 2016 to 33.3% in 2020, and the underemployment rate rose from 21% to 22.8%. Based on the new methodology to which NBS recently transitioned, the unemployment rate in the first quarter of 2024 was 5.3 percent and the time-related underemployment rate was 10.6 percent.
The unemployment rate of 5.39 percent in 2023 means that 84.15 million people in the labor force are engaged in some activity out of a population of 88.94 million. Of these, 92.2% worked in the informal sector, while only 78% were engaged in formal economic activities.
Unemployment rates are highest in Abia (18.7%), FCT (14.1%) and Rivers (13.4%), while lowest in Nasarawa (0.5%), Sokoto (1.2%) and Benue (1.6%).
Employment by economic sector
The main economic sectors for Nigerian workers are agriculture (30.1%), wholesale and retail (27.5%), manufacturing (12.7%), accommodation and food services (7.8%), with 80% of Nigerian workers The neighborhood belongs to these four major sectors. Sector.
Most Nigerians work in the private sector (74.4%) and 25.6% work in the public sector. The main occupations of Nigerians are services and sales (33.8 percent), agriculture (28.1 percent), and handicrafts and related trades (14.4 percent).
“States with high poverty rates tend to have relatively low unemployment rates. Policymakers should pay close attention to this relationship and conduct further empirical analysis to determine its reasons and impact.” ADSR states.
