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“Nigeria’s unemployment rate has undergone a significant decrease, plummeting from 33.3 percent in 2020 to 4.1 percent in the first quarter of 2023 and 5.3 percent in the fourth quarter of 2022.

However, the National Bureau of Statistics (NBS) has noted that the calculations for 2020 and the current data were derived using distinct methodologies, following a two-year pause in reporting.

This new unemployment rate, a result of the labor force survey (LFS) conducted in Nigeria, emerges after a two-year gap following the last official data release of 33.3 percent for the fourth quarter of 2020, which was made public in March 2021.

Adeyemi Adeniran, the Statistician-General of the Federation, weighed in on the labor force survey report, explaining that the decline is primarily attributed to the National Bureau of Statistics adopting a new methodology for conducting the survey. He clarified that this shift does not necessarily reflect government performance.

The Nigeria Labour Force Survey is conducted quarterly to generate official national statistics on aspects like the labor force, employment, and unemployment, serving as a basis for monitoring and planning purposes.

The updated methodology aligns Nigeria’s Labor Force Statistics with international standards and best practices. However, Nigeria has faced challenges in ensuring timely publication of the report. Businessday’s investigation revealed that no data was published for all four quarters of 2021, as well as the first three quarters of 2022.”

Clarification

“The Statistician General emphasized that there exists no valid foundation for comparing the data from two years ago, when the previous report was issued, with the current figures.

“The National Bureau of Statistics (NBS) has not asserted that Nigeria’s unemployment rate has ‘reduced from 33.3% to whatever the figure it is now, therefore the government should become complacent.’ No, that is not the message we are conveying,” the Statistician General strongly emphasized during his comprehensive keynote speech.

He clarified that, “The current figures are not indicative of any performance metric, but are solely, and I repeat, solely influenced by the shift in methodology… this shift adheres to the new ILO standard, which Nigeria is an integral part of as a nation.

“In fact, the current Chair of the ILO Governing Board is Nigeria’s Permanent Representative to the United Nations in Geneva, H.E, Ambassador Abiodun Richards Adelaja, underscoring our alignment with the ILO standard. We cannot continue to diverge from the ILO standard… we have adopted the ILO standard methodology, which, I believe, we have substantiated sufficiently. As a result, the figures have changed, and the new and old data are incomparable.”

The Statistician General also highlighted that the Nigeria Labour Force Survey (NLFS) is a tool to ascertain individuals’ engagement status, the nature of their engagement, whether for remuneration, personal use, or voluntary work. He stressed that this underscores the growing significance of the concept of “decent work” as demands for improved working conditions rise. He clarified that the assessment of an individual’s life quality is not within the scope of NLFS, as there are other surveys designed specifically for that purpose, such as the Nigeria Living Standard Survey (NLSS), Food and Nutrition Survey, and Household Consumption and Expenditure surveys, all of which focus on welfare and living conditions.

He pointed out, “Waged employment, often misconstrued as the sole criterion for employment, disregards self-employment, constituting only 11.8%. This highlights that the majority of Nigerians are self-employed. Should we then label the self-employed as unemployed? This perspective is untenable; hence the emphasis should shift to the quality of work, which appears to be the crux of the matter.”

Unveiling the survey’s genuine outcomes, Adeniran elucidated that “the findings indicate that approximately three-quarters of Nigerians within the working age demographic, 73.6% in Q4 2022 and 76.7% in Q1 2023, were engaged in work for pay or profit during the respective quarters.

This workforce comprises individuals in diverse types of employment, spanning both formal and informal sectors. Moreover, 4.96% were involved in subsistence agriculture in Q4 2022, while 3.56% of the working age population participated in subsistence agriculture in Q1 2023.

Furthermore, the proportion of the working age population in Nigeria who are not engaged in employment was 21.4% in Q4 2023 and 19.8% in Q1 2023. Adeniran clarified that “not engaged” encompasses those within the working age population who are unemployed and not actively seeking employment, such as students, housewives, and those unavailable and not actively looking for work. Therefore, the “not engaged” rate should not be equated with the unemployment rate.”

“Undoubtedly recognizing the global challenge that unemployment poses, he acknowledged that this issue persists in Nigeria.

In his own words, “Employing the new ILO definition, the survey reveals that the unemployment rate was 5.3% for the fourth quarter of 2022 and 4.1% for the first quarter of 2023.

“These figures correlate closely with those of neighboring countries to Nigeria. Ghana (3.9%), Niger (0.5%), Chad (1.4%), Cameroon (4.0%), Togo (4.1%), Benin Republic (1.7%), and others all fall within similar ranges.

“Unemployment is particularly pronounced among individuals with post-secondary education, reaching 9.1% in the fourth quarter of 2022. This figure nearly doubles the headline unemployment rate for that period, underscoring the persistent challenge of graduate unemployment, where individuals, despite their education, grapple with joblessness.

“Underemployment, too, remains a significant issue in Nigeria. Individuals currently engaged in some form of work express a desire and availability to take on more work, driven by the inadequacy of their present employment situations.

“The survey’s findings estimate the underemployment rate to be 13.7% in the fourth quarter of 2022 and 21.2% in the first quarter of 2023. This reflects the reality that despite current engagement, many individuals seek additional work hours,” he explained.

The survey also gauges the informality of employment. Given Nigeria’s expansive informal sector, the number of individuals engaged in informal employment is somewhat nebulous.

“Applying the ILO definition, the survey approximates that 93.5% of employed individuals engaged in informal employment in the fourth quarter of 2022, while 92.6% of employed individuals did so in the first quarter of 2023.

“According to him, this data holds significant relevance, especially for the government’s ongoing discussions regarding palliative measures following the removal of petrol subsidies.

Addressing the importance of a robust, regular national data like the Labour Force Survey report, the World Bank Country Director, Shubham Chaudhuri, stressed that reliable data provides the government with insights into the nation’s welfare and enables the implementation of appropriate interventions and programs to tackle challenges.

Chaudhuri highlighted that over 130 million Nigerians experienced multidimensional poverty. He emphasized the paramount importance of the report in terms of job creation and poverty reduction.

The Permanent Secretary of the Ministry of Budget and Economic Planning, Nebeolisa Anako, deemed this achievement consistent with the administration’s mandate, given the significance of data. “We place greater emphasis on reliable data, and the ministry will continue to support the bureau to ensure the availability of dependable data.

“Hence, the importance of this report lies in its capacity to reveal economic realities. The labor force report serves as a crucial indicator in the economy.

Minister of Budget and Economic Planning, Abubakar Bagudu, echoed the sentiment that data is pivotal to the nation’s development and planning.

He stated, “The President believes in reliable data for planning and will support any effort that leads to the production of accurate data.

“To generate jobs for the youth, this type of data is essential. A substantial amount must be done to address the high unemployment rate in the country. The President is dedicated to reducing unemployment.

“Nigeria possesses the capacity to absorb employment opportunities, and thus, our focus should be on fostering a better environment and providing more incentives.”

Reaction

Analysts who spoke with Businessday, said that the delays showed government lack of concern for human development amidst high rate of poverty in the country.

Paul Inyang, Abuja based economic analyst, decried that most government initiatives and interventions are often designed without acurate data and implemented based on assumptions.

For him, no country can have a meaningful development in the absence of accurate and current.

“If the government is concerned about the well being of its citizens, they will be expectant to know these figures because it shows the welfare of the citizens.

“How do we ensure meaningful interventions and programs if we do not have accurate data, this only happens in Nigeria where people come into government to enrich themselves.

“Even when these data are finally released, some do not reflect the realities of happenings in the country,” he said.