Pegasus Reporters Issues on the Wing
“There is a need to shift focus to matters that will create employment rather than bellyaching over perceptionally jaundiced data. The uproar should be more about addressing the unemployability and underemployed challenges than crying over unemployment. The politicization of unemployment is a tool for politicians to continue exploiting the pains of the people for personal interests and gains”
Simon Lalong, Nigeria’s Minister of Labour and Employment
PEGASUS REPORTERS, LAGOS | AUGUST 31, 2023
When the Nigeria Bureau of Statistics, NBS revised its methodology of calculating unemployment data in the country, a drop from the previous 33% to 4.1% unemployment rate had many scratching their heads
This new data does not agree with widely held opinions about national unemployment, especially as the previous data was incidentally provided by the same NBS. The 2022 MPI report of 133+m Nigerians living in multidimensional poverty also lends credence to the frustration of many regarding the revised unemployment statistics.
To this end, it is imperative to educate the public and get some clarity regarding the contextual meaning and implications of these data, which appeared to be at variance with themselves and the perception of many Nigerians.
What is unemployment?
According to brittanica.com, unemployment is “the condition of one who is capable of working, actively seeking work, but unable to find any work” A couple of things stand out in this definition. Capacity to work. Willingness to work. Inability to find work. The definition does not say anything about quality of work, duration of work, or qualifications for the work.
The above distinctions are necessary to properly dimension Nigeria’s unemployment narrative. The first step is for us to agree that a person who is incapable of performing or delivering on a particular task or job can not claim to be unemployed. At best, the individual is unemployable, a very different problem, and in my estimation, a more serious problem whose significance is often overlooked and underestimated.
Also, a person who is not willing to perform a task for remuneration, for whatever reasons, can not be categorized as unemployed. It means the individual considers himself better occupied otherwise.
The final part of this definition is the availability of work. Work simply means any task one can do and get compensated for. The quality, duration, and continued availability of this specific task to the specific individual are immaterial. Thus, an individual can only be classified as unemployed if he/she is willing and able to work but can not find ANY work to do!
To make it simple to understand, if a 25-year-old university graduate of sound body and mind refuses to take up a construction site job, he is not unemployed. If he does take up the task, he is underemployed. This means he is materially qualified for a better quality of work but is unable to secure one.
Suffice it to say that this can be a result of a number of different factors, e.g., how many openings are there for the degree qualification? How extensive is his job opening awareness network? What extra activities has he done to distinguish himself in the employment market space and improve his chances? etc.
The above highlights an often overlooked constraint. It is no longer a question of job availability. It is more about the active dedication to position oneself to be selected above other aspirants for work.
Statistics and methodologies
With reference to the above clarifications, let us contextually review the differences between the 2 figures, former and current, that the NBS used. The previous figure was based on a minimum of 20 hours of work per week, whilst the current figure uses a minimum of 1 hour of work per week. The question that arises then is, how many jobs can guarantee a minimum of 20 hours per week? This condition is more appropriately applicable to 9-5 jobs.
Illustration only. Picture of Nigerian youths (image credit- Freepik images)
According to the same NBS, 41.4 million out of the 41.5 million small and medium enterprises (SMEs) in the country, about 98.9%, fall into the informal and nano business categories. These are your artisans, petty traders, transporters, PoS operators, laborers, domestic security men, domestic helpers, drivers, danfo/Keke/okada riders, etc. Can we reasonably say these guys are guaranteed 20 hours of work per week? Even in better-developed economies, mechanics, carpenters, tailors, plumbers, etc. are not guaranteed 20 hours work weeks!
They often have periods of being occupied and significantly larger periods of inactivity. That is why the quality of one’s work, one’s ability to position and market his/ her services, as well as one’s personal and career self-improvement efforts, differentiate. Thus, it is reasonable to acquiesce that the methodology that captures the reality of available work is a proper way of dimensioning the unemployment data.
About multidimensional poverty
The World Bank defines the Multidimensional Poverty Index as the measure of the percentage of households in a country deprived along three dimensions –monetary poverty, education, and basic infrastructure services – to capture a more complete picture of poverty.” Basically, this index is actually a measure of individual earning capacity, availability of social infrastructure and amenities, and access to education for self-improvement.
Thus, the MPI is an index for assessing the depth and pervasiveness of physical, mental, and social development in a country. An important deduction from the above is that MPI reviews the social development of the entire society as against individual earnings.
To shed more light for the purpose of understanding, everyone who plies poor roads lives with an epileptic power supply, has limited access to potable water, etc. is caught up in the MPI!
Most of Nigeria’s population is in rural areas where access to basic social infrastructure and amenities is limited or non-existent. The MPI is, therefore, more an assessment of needed improvements in access and availability of social infrastructure and amenities.
This is highlighted by Investopedia’s definition of poverty. Poverty is defined as the “state or condition where people and communities can not meet a minimum standard of living because they lack the proper resources”
Perception vs Reality
The popular unemployment narratives are driven more by perception than reality. The real problems we have as a nation regarding unemployment are underemployment and unemployability. Incidentally, these are also derivative of the MPI because they address the poor and limited productivity in society.
The job of government is not to create jobs. The job of government is to create enabling social and business environments that will facilitate development. Increased productivity will create more opportunities for employment. We have seen how the creation of accessible roads has led to the residential and commercial explosions of places like Ikorodu, Ikotun, Epe, Mowe/Ibafo, etc. in the Lagos- Ogun State axis. An improvement in access and availability of social infrastructure and amenities in these areas organically created jobs for many people and facilitated an influx of even more.
The problem of underemployment is personal and global. There are limited jobs and demand is very high. Hence, progressive economies push to build aggregate entrepreneurial bases. In short, rather than looking for work, the government should support citizens to create one.
It must be said that the perception that once one possesses a University degree, one should instantly be given employment should be discarded. The period when a university degree guaranteed a good life and employment was when the country had a smaller population compared with available resources. Times have changed significantly.
The biggest problem, in my opinion, is unemployability. The country boasts a large contingent of people who are physically able to work but who lack the mental, moral, and social requisite qualifications. Anyone with a poor attitude is unemployable. Anyone who feels entitled to what he has not earned is unemployable. Anyone with moral deficiencies is unemployable. Anyone unwilling to push for personal and career self-improvement is unemployable. Unfortunately, the vast majority of those screaming about unemployment fall into at least one of the aforementioned groups.
Conclusion
There is a need to shift focus to matters that will create employment rather than bellyaching over perceptionally jaundiced data. The uproar should be more about addressing the unemployability and underemployed challenges than crying over unemployment. The politicization of unemployment is a tool for politicians to continue exploiting the pains of the people for personal interests and gains.
If the problem is misdiagnosed, it will be impossible to treat effectively and as appropriate. We should all hold our elected officials accountable to provide the necessary progressive environment. Once this is done, unemployment will solve itself.
Femi Onakanren is a Business Consultant and a Socioeconomic Policy Analyst. He writes from Lagos
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