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Nigeria employment crisis worsens

About a quarter of working-age citizens are not in the labour force at all.

By Oscarline Onwuemenyi
ABUJA—NATIONAL Economic Management Team, NEMT, and the World Bank, yesterday, endorsed a pact with stakeholders in the public and private sector to stem youth unemployment in the country.

Meanwhile, the World Bank has observed that Nigeria was facing an urgent job challenge, in spite of noticeable growth in the national economy.

A Private Sector Development Specialist with the Bank, Mr. Richard Sandall told Vanguard: “About a quarter of working_age citizens are not in the labour force at all. Only around 10 percent of the labour force is in formal waged employment, with the rest in the low paid, insecure informal sector.

“Despite its riches from oil and growing economy, waged employment in Nigeria is actually falling. Only with job growth can Nigeria meet its commitments to poverty reduction, and its Vision 2020 objectives.”

He said the NEMT’s ‘Growth and Employment Pact’ was a recognition that more can be done to boost employment, especially in sectors that have great promise for the country, adding: “The pact is an opportunity for key job creating sectors of ICT, construction, entertainment, tourism, and meat and leather; to identify the barriers of growth, and to work together with Federal and state governments to unleash their full potential.”

On his part, the Minister of Finance, Mr. Olusegun Aganga, declared the readiness of the team to address “the paradox of a growing GDP at the same time as we are witnessing growth in unemployment, which is most severe on youth in urban areas.”

He noted that the event was unique because “it is the first time we have brought key stakeholders in five sectors of our economy together with the public sector to discuss the barriers to growth and to agree on a pact on what each party has to do to improve the business climate and grow the economy and create jobs.

Assessment of progress

“The pact will be monitored to ensure that each party delivers and in the coming months we plan to meet to assess progress made.”

The minister said real GDP had been strong for each of the last five years, measuring at six percent or higher each year between 2005 and 2009. He noted: “However in the same period, the national unemployment rate has risen annually, from 11.9 per cent in 2005 to 19.7 per cent in 2009, according to the National Bureau of Statistics.

President Goodluck Jonathan, has made it absolutely clear that this is unacceptable.”
Aganga observed that in the last few months, the NEMT had consulted with various business leaders in various sectors of the economy as well with the development financial institutions such as the World Bank, focusing on how to support growth that was rich with job creation opportunities.

He said the sectors were chosen because they “are sectors of our economy that already enjoy a high rate of growth in spite of the infrastructure and other challenges (leather is consistently one of the country’s highest non-oil exports); and they are centred in key economic clusters such as Lagos (construction), Kano (leather), Abuja (ICT) etc;

“Also, they have long local value chains meaning that they are high employers of labour and have relatively high multiplier effects on the rest of the economy. They are also sectors that are particularly sensitive to government and private sector policy intervention matrix where some actions are best done by government alone.

“This is the solution that will ensure that when the 2010 unemployment rates are calculated, we will experience a drop in the unemployment rate for the first time in five years.”

Meanwhile, the Lead Economist of the World Bank, Mr. Volker Treichel, who spoke at the forum, said that more than 40 percent of youth in the country were unemployed, a situation that had made the country a hot-bed for youth restiveness.

He said: “Youth unemployment is rising in the country causing unrest and other social problems. Growth has not been in line with the aspirations of the people and has not been driven by higher productivity.”

He noted that since 2003, non_oil growth has “doubled to about seven percent from 3-4 percent during the previous five-year period,” adding, however, that “public perception is that there has been little job creation.”


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