The long awaited list of potential ministers has come. The Senate will begin the usual and most times, lucrative screening exercise and hopefully, the successful candidates will mount the podium and form the federal cabinet. But in reality, how does that change the growing unemployment in our country? With the exception of the presidential election results in March of this year, the anxiety and anticipation about the ministerial list exceeded anything we have ever witnessed in Nigeria. Reason being that Nigerians are more secure in government employment, where access to easy funds is commonplace. This abnormal reality is the core reason why everyone wants to get into government, either through politics or the civil service.
In a normal country, the Ministry of Labour and Productivity would have, on a monthly basis, surveyed thousands of households to gather information about labour market activities. It would have used the information from the survey to derive the number of Nigerians unemployed.
The population of Nigeria can be divided into two broad groups; one group consists of persons who are (1) under 16 years of age, (2) in the armed forces, or (3) institutionalised (in prison, mental institutions, or homes for the aged). The second group, which consists of all others in the total population, is called the civilian, non-institutional population.
Roger Arnold stated, “The civilian non-institutional population, in turn, can be divided into two groups: persons not in labour or workforce and persons in the labour force.
“Persons not in the labour force are neither working nor looking for work. In this category, for example, are people who are retired, who are engaged in own-home housework, or who choose not to work.
“Persons in the labour force fall into one of two categories: employed or unemployed.
The unemployment rate is the percentage change of the civilian labour force that is unemployed. It is equal to the number of unemployed persons divided by the civilian labour force.”
By May 29 this year when Jonathan’s term formally ended, the unemployment rate was about 50% of the labour force. Therefore, nearly 50 million Nigerians were either out of job, under-employed or never formally employed, but capable of working. Today, the rate of unemployment has surged to over 65% of the workforce and the figure keeps rising. This staggering figure is one of the largest in the world and it indicates danger in our society.
Ministers or not, employment is always created through the fiscal and monetary policies of a country’s Central Bank. As such, once there is an active Central Bank governor, there must be a stimulus package to grease the economy into creation of jobs. The ultra-high lending rates of commercial banks are a direct impediment to sustainability of jobs.
The United States Federal Reserves (their own Central Bank) cautiously kept interest rates abysmally low, to enable businesses grow and prosper after the recession. If a business grows, employment is induced and vice versa.
The only viable business in Nigeria is politics. This is the only country in the world where the majority of the citizens want to be engaged in politics. It is the most profitable business; even professionals hang around the corridors of power. It is big business and was especially so during the Peoples Democratic Party days. Somehow, the effect of such notion has left many Nigerian professionals delusional about getting regular jobs. Politics in Nigeria has always been hinged on recklessly blowing oil money. Productivity is ever non-existent.
The norm in Nigeria is the high craving for government jobs. Everyone hopes to get employed in a government agency or enterprise, since there are glaring hurdles to private firms. The big mistake this nation makes all the time is that government is supposed to create an enabling environment for private businesses to thrive. A mere catalyst, but the economic development of any country is the prime effort of privately owned companies. Unnecessarily absurd policies aimed at truncating non-government enterprises keep roaming around our economic domain, but it seems very few top government officials, especially at the Central Bank of Nigeria (CBN), understand how privatisation drives other countries’ economies.
The tight control of the foreign exchange market has had an adverse effect on businesses, which has directly affected job creation. Business analysts have said that the CBN’s recent directive excluding some essential raw materials from the list of items valid for forex will, in no time, lead to the laying off of 40,000 Nigerians in the scanty manufacturing sector.
Also, the lengthy and unorthodox procedures by which banks process loan requests in Nigeria cannot support economic development that will lead to the proliferation of jobs. Despite tight control, the Naira has constantly declined in value – another error from trying to over-control economic activities in Nigeria.
A friend of mine was recently kidnapped by Fulani herdsmen. In the conversation with his captors, he realised that these criminals prefer kidnapping for ransom to rearing cattle. They confirmed to him that it’s much easier to make money that way, because cattle rustlers deprive them of their livelihood. But who are the cattle rustlers? It is estimated that 90% of those who go about stealing cattle from the Fulani are unemployed, active young men who must survive by any means necessary.
This is a drag in our social sphere. Joblessness has created kidnapping for ransom and even those who have a means of survival, like the Fulani herdsmen, have found it easier to make money through illegal and dangerous means.
These days, the majority of highway armed robbers are young university graduates who have found the system unresponsive to their plight. They must survive. Therefore, taking up arms to force innocent Nigerians to cough out money becomes the easiest path to life.
The CBN’s draconian foreign exchange policy in July of this year has gravely contributed to the growing unemployment. Those whose businesses relied heavily on the importation of goods suddenly went out of business, as transferring funds abroad instantly became impossible. The majority of import-dependent entrepreneurs have abandoned their businesses and are waiting for when this negative policy will be repealed. It’s needless to expatiate the impact of this policy; the multiplier effect.
In economics, productivity is commonly defined as the ratio between the output volume and the volume of inputs. In other words, it measures how efficiently production inputs, such as labour and capital, are being used in an economy to produce a given level of output.
While the Bank of Industry’s N2billion graduate entrepreneurship fund (GEF) scheme to support young graduates with viable ideas to receive training and finance is laudable, the accessible figure of N500,000 to N2m places the aggregate number of recipients to a maximum of 4000 people. This is a far cry from the estimated 16 million unemployed young graduates on the streets.
The future of this great nation lies in getting the workforce gainfully employed, which means government must encourage private investment in productive sectors.
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