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Special Report: Believability issues as NASME, CSJ, experts contest NBS methodology, 4.1 percent unemployment rate in Nigeria

*The Nigerian Association of Small and Medium Enterprises, Centre for Social Justice, and other market experts have roundly criticised the latest unemployment figures and methodology used by the National Bureau of Statistics in its latest report, arguing about 10 percent of 40 million Micro, Small and Medium Enterprises have shut down since the Federal Government announced fuel subsidy removal May 29, 2023

Isola Moses | ConsumerConnect

Experts have interrogated and dismissed the new unemployment figures and methodology the National Bureau of Statistics (NBS) used in determining the level of unemployment and underemployment rates in Nigeria.

The professional groups and experts have  describing these as an act deliberately antithetical to the socio-economic realities in the West African country, a report said.

The leadership of the Centre for Social Justice simply described the Bureau’s latest report indicating a 4.1 percent unemployment rate in Nigeria as “a waste of tax payers money to produce a report that adds no value to the Nigerian people and their economy.”

Recall the NBS recently  announced that Nigeria’s unemployment rate “dropped drastically” from 33.3 percent in the fourth quarter of 2020 to 4.1 percent in the first quarter of 2023.

The Bureau, in the new report, showed that unemployment stood at 5.3 percent in Q4 2022 and 4.1 percent in Q1 2023.

However, experts have dismissed the NBS’ new unemployment figures and the methodology in determining the level of unemployment and underemployment in Nigeria, Leadership report said.

But the NBS has justified the new report, stating that it aligned with the rates in other developing countries where worked.

It further contended even if only for a few hours and in low-productivity jobs, it  is essential to make ends meet, particularly in the absence of any social protection for the unemployed in the economy.

22.3 percent of the working-age population were out of labour force Q4 2022, while it was 20.1 percent Q1 2023.

Nigeria and several consumers have been battling a high volume of unemployment as many companies cut jobs and reduce wages to meet prevailing economic volatilities in recent times, report noted.

Millions of MSMEs close shop over petrol subsidy removal: NASME, others

Reacting to the Bureau’s latest figures, Abdulrasid Yarima, President/Chairman of the Governing Council of the Nigerian Association of Small and Medium Enterprises (NASME) reportedly said about 10 percent of the 40 million Micro, Small and Medium Enterprises (MSMEs) in the country had shut down since the Federal Government announced the removal of fuel subsidy.

The likes of ShopRite, Procter & Gamble, Surest Foam Limited, Mufex, Framan Industries, MZM Continental, Nipol Industries, Moak Industries, Deli Foods, and Stone Industries, among others, have wound down fully or partially in the past five years, report said.

Speaking on the development also, Uche Uwaleke, a Professor of Capital Markets at the Nasarawa State University,  contended the 4.1 percent unemployment figure did not reflect the true situation on the ground owing to a number of reasons.

These the market expert noted include the low sample size of under 40,000 persons used in the survey as well as the adoption of the International Labour Organisation (ILO) guidelines for employment computation.

Uwaleke opined the ILO guidelines consider employment from the perspective of persons of working age who are engaged in some type of jobs for at least one hour in a week for pay or profit.

The Professor of Capital Markets stated: “Compared to the old methodology adopted by the NBS, this new methodology, which includes apprentices, is tantamount to significantly lowering the bar and could lead to wrong policy decisions by the government.

“Much as the ILO guidelines provides a basis for global comparison, it is important that Nigeria adopts country-specific guidelines which closely reflect unique employment conditions prevalent in the country.”

The newly-released NBS report, however, claimed the rate of informal employment among the employed Nigerians was 93.5 percent Q4 2022 and 92.6 percent Q1 2023.

Adeyemi Adeniran, Statistician-General of the Federation, also explained the results indicated a scarcity of wage-employment, as the share of those employed in Wage-employment during the referenced quarters was 13.4 percent Q4 2022 and 11.8 percent Q1 2023.

In Q4 2022, 2.6 percent were engaged as Apprentices/Interns and 2.2 percent Q1, 2023.

A further 10.7 percent in Q4 2022 and 10.6 percent Q1 2023 were engaged helping (without pay or profit) in a household business.

According to the Bureau, most Nigerians operate their own businesses or engage in farming activities as an alternative source of livelihood.

The shares are 73.1 per cent and 75.4 percent in Q4 2022 and Q1 2023 respectively.

Reports as well indicate that Nigeria’s high cost of production was N788. 7 billion 2022 as against N630.7 billion in the first half of 2021, thereby making imported products cheaper than locally produced goods.

The NBS said in the Labour force statistics report that “underemployment rate which is a share of employed people working less than 40 hours per week and declaring themselves willing and available to work more was 13.7 per cent in Q4 2022 and 12.2% in Q1 2023.”

The share of wage employment was 13.4 per cent in Q4 2022 and 11.8 per cent in Q1 2023.

About one-third (36.4 per cent in Q4 2022 and 33.2 per cent in Q1 2023) of employed persons worked less than 40 hours per week in both quarters. This was most common among women, individuals with lower levels of education, young people, and those living in rural areas.

About three-quarters of working-age Nigerians were employed–73.6 per cent in Q4 2022 and 76.7 per cent in Q1 2023. This shows that most people were engaged in some type of jobs for at least one hour in a week, for pay or profit

The results presented in this report are for the reference periods of Q4 2022 and Q1 2023, stated the Bureau.

The share of the working age population in Nigeria that are not working was 21.4 percent in the fourth quarter of 2023 and 19.8 percent Q1 2023.

NBS report on unemployment figures ‘a waste of tax payers’ money’, says CSJ

In its reaction to the NBS  report on the country’s unemployment rate, the Centre for Social Justice (CSJ) has rejected the report.

The organisation argued that the Bureau’s report was not supported by the increasing unemployment in Nigeria since the last report in 2020, which put Nigeria’s unemployment rate at 33.3 percent.

The CSJ said since 2020, Nigeria’s economic challenges had increased with galloping inflation, factory closures, rural dwellers, who have been prevented by insecurity from planting and harvesting and a public sector with a moratorium on new recruitments.

Eze Onyekpere, Lead Director of CSJ, also said: “The whole basis of a job report is to help the government to determine whether its plans, policies and laws geared at reducing unemployment are achieving the desired milestones.

“What is the point of a job report that tells the government that more Nigerians are employed when it is a clear and notorious fact that unemployment is increasing?”

Onyekpere further contended: “The NBS is counting people who are working for at least one hour in a week or who are self-employed in low-productivity activities as ‘employed’.”

“This is not an accurate reflection of the reality of the Nigerian labor market.”

The CSJ asserted: “Simply to satisfy a fad, it is a waste of tax payers money to produce a report that adds no value to the Nigerian people and their economy.”

The organisation maintained that these unemployment statistics do not in any way reflect the prevailing economic challenges experienced by Nigerian consumers, especially in recent times.

Hitherto, the

CSJ previously, had emphasised the urgency for the NBS to provide up-to-date employment data for the years 2021 and 2022, report said.

Onyekpere noted: “This reported (unemployment) rate is incongruent with the economic challenges faced by a significant percentage of the population.

“We call on the NBS to reconsider its methodology and ensure that it accurately captures the full spectrum of employment challenges faced by Nigerians.”

He stated: “It is essential that job reports reflect the realities and provide an honest assessment of the economic landscape.

“Only through accurate data can the government develop effective strategies that deliver on its promises and address the pressing issues facing our nation.”

The organisation, therefore, urged the Federal Government to ignore the report, take steps to create more decent jobs, and improve the livelihoods of Nigerians.

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