Nigeria Jobless Rate Climbs To Highest In At Least A Decade

Unemployment in Nigeria surged to the highest in at least a decade in the second quarter as the coronavirus pandemic made it even tougher for output growth in Africa’s largest economy to keep up with its fast-expanding population.

The jobless rate rose to 27.1%, according to a National Bureau of Statistics report published on its website on Friday. That compares with 23.1% in the third quarter of 2018, which was the last period the agency released labor-force statistics.

The unemployment rate in Africa’s largest oil producer more than doubled over the last four years as the country struggled to recover from a contraction in 2016. Even the quality of employment has deteriorated with one in every two working Nigerians either unemployed or underemployed.

“The underemployment rate rose much faster, so the combined unemployment rate is now at 56%, up from 43%,” said Michael Famoroti, chief economist at Lagos-based Stears. Real unemployment could be much higher with the official statistics showing that the labor force has shrunk by 10 million people since 2018, Famoroti said.

The slow-moving recovery was upended by the coronavirus pandemic, which slashed crude revenues and dried up the supply of dollars needed by businesses in a country that has long struggled to provide jobs for its young population. Unemployment among youth, which make up half the population stood at 34.9% in the second quarter and underemployment in the segment was 28.2%. The Nigerian economy is expected to shrink 5.4% this year, its worst contraction in nearly 40 years, according to the International Monetary Fund.

Joblessness will likely climb further even as the government of President Muhammadu Buhari launches a program to employ nearly 800,000 people to build new infrastructure in an attempt to ease the blow of the pandemic.

“The country had fundamental structural imbalances pre-Covid which are yet to be addressed, so I think we should expect to see an increase in the unemployment rate,” said Omotola Abimbola, an analyst at Chapel Hill Denham Securities Ltd.

For years the population growth rate in Nigeria has outpaced economic output, making it the country with the highest number of poor in the world. With a fertility rate of five children per woman, Nigeria is expected to be the third most populous in the world by 2050 with over 300 million people, according to the United Nations

The number of people looking for employment through Nigeria’s biggest recruiting website Jobberman Ltd. has jumped five-fold since the start of the Covid-19 pandemic, Chief Executive Officer Hilda Kragha said in an interview last month.

– Bloomberg.