The unemployment time bomb

By AYOOLA OLAOLUWA

Nigeria’s youth unemployment rate has continued to rise unabated, with experts describing it as a ticking time bomb waiting to explode and ultimately shake the nation to its foundation.

Data obtained by Business Hallmark shows that Nigeria’s unemployment rate is at an all-time high. More than 70% of the Nigerian population is currently unemployed or under employed. More alarming is the fact that mostly youths and energetic adults share the huge burden,

According to the latest report by the National Bureau of Statistics (NBS) released in December 2016, 3.67 million Nigerians became unemployed within a one-year period, October 2015 to September 2016.

The report said the number of unemployed Nigerians rose from 7.51 million in the beginning of the October 2015 to 11.19 million at the end of September 2016, while the general unemployed population rose from 55.21 million in the beginning of the fourth quarter to 69.47 million as of the end of September.

The NBS report showed that unemployment rate was highest for persons in the labour force between the ages of 15-24 and 25-34; and unemployment and underemployment were higher for women in the third quarter of 2016.

Underemployment occurs when a person works less than full time hours, which is 40 hours, but work at least 20 hours on average a week. Underemployment could also happen if a person works full time but are engaged in an activity that underutilises his skills, time and educational qualifications. The unemployment report for the fourth quarter of last year, October to December 2016, is still being prepared by the NBS and was due for release on March 29 – but it is still been awaited.

Checks by BH revealed that the situation is getting grimmer by the day as more businesses are daily shedding jobs to cut costs and optimize profit because of the current economic state of the nation.

Banks and telecommunications companies added the most to the unemployment rate in 2016. FBN Holdings sacked 1000 workers in May, Diamond Bank fired 200 staff and Ecobank Nigeria retrenched 1040 people in June the same year, while Zenith Bank PLC sacked about 240 people, including eight General Managers and 40 Assistant General Managers.

Also in July 2016, 3000 workers lost their jobs in the shipping industry. Many oil companies, including Chevron, ExxonMobil, Pan Ocean and Ground Petroleum, followed suit by sacking about 3,000 oil workers.

Desperate Nigerians now scramble for the few available jobs, particularly government jobs on offer. In March 2016, the police website crashed in less than 24 hours after it went online due to heavy traffic of applicants. Within three weeks, over 550,000 applicants had indicated interest in the 10,000 jobs in the Force, with several weeks still left for more applications. At the end of the exercise, over one million applicants applied for openings in the Force but only 10, 000 were recruited.

The same scenario played out in June 2016 when the Federal Government’s newly launched Jobs portal, N-Power. gov.ng, recorded over 500,000 successful registrations, less than two days after it was declared open. This underscores the huge number of unemployed Nigerians, despite government assurance that the situation is under control and efforts to curb joblessness will pay off in 2017, with almost half of the year gone.

Efforts by successive governments to contain the problem have recorded little success, as youths, especially university graduates have continued to stream out with decreasing opportunities of employment.

Based on the data released by the Joint Admission and Matriculation Examination Board (JAMB), 1.7 million candidates are currently sitting for the ongoing 2017 Unified Tertiary Matriculation Examination (UTME), as against 1,561,443 candidates that sat for the same examination in 2016. The figure has continued to rise in the last ten years.

While only 100, 000 or more normally gain admission, the rest jostle for admission into colleges of education and polytechnics. Yet after graduating, the successful ones don’t have any guarantee of getting jobs.

According to the National Bureau of Statistics (NBS), at least, 1.8 million graduates in the country move into the labour market every year. The data was generated by NBS for the Federal Government in 2014 to ascertain the level of youth unemployment and to come up with policies to address it. However, a source at the bureau said that the figure should be hitting the 2million mark by now.

Some analysts put part of the blame on the proliferation of universities from the 1980s at the detriment of professionally skill oriented institutions of the 1950s/60s. Millions of Nigerian youths graduate from the universities, polytechnics and other tertiary institutions every year, without any hope of finding job.

While painting a picture of the dire situation, a former Vice Chancellor of the Abia State University, Uturu, Prof. Agu Mkpa, said that youth unemployment is a time bomb that has the most broad-based devastating, most traumatic impact above all the societal ills facing the country.

“The danger of youth unemployment is that it is the harbinger of numerous other national ills. It is the root cause of many other social ills. If not quickly resolved, it could pose a threat to the nation’s development, security and peaceful co-existence”.

Also, a security expert who spoke with BH, Dr. Ona Ekhomu, said that Nigeria is experiencing insecurity largely due to joblessness. Ekhomu, who is the President, Association of Industrial Security and Safety Operators on Nigeria, added that unemployment rate which has been rising consistently since 2014 will increase existing risk of insecurity and militancy in major parts of the country and undermine government’s efforts at fighting insurgency in the Northeast, militancy in the Niger Delta, uprisings in the Southeast and other serious crimes in parts of the country.

A former President of the Nigeria Employers Consultative Association (NECA), Mazi Sam Ohuabunwa, while commenting on the high rate of unemployment and its implications for the country, called for urgent action by government. He attributed the high rate of unemployment to many factors such as high dependence on oil revenue and limited diversification of the economy.

“The impact of unemployment is already evident, as we look at general levels of militancy in the South South, the problems with the Boko Haram and even some of the eruptions in other parts of the country, especially the IPOB and the MASSOB,” says Ohuabunwa who still sits in the NECA council.

He disclosed that the country’s misery index has reached 50 per cent, meaning that more than half of Nigeria’s more than 180 million people “are miserable.” The Misery Index is a measure of unemployment in line with inflation rate — the average rate of increase in prices of goods and services.

Ohuabunwa explained that gross unemployment rate when factored with under-employment rate in the third and fourth quarters of last year for example, puts the unemployment rate at 50 per cent.

“We are the third highest country with misery index, only behind Venezuela and Iraq. Recession has worsened our condition. Therefore, social stability and job creation should be at the core of our economic policy.”

A professor of economics, Emmanuel Nnadozie, painted a gloomier picture of the danger of unemployment, saying Nigeria’s biggest challenge was youth unemployment.

“I have analysed the challenges of development for over 30 years and I have come to the conclusion that this is the greatest threat because the population growth rate is too high and everybody puts their heads in the sand as if this is not an issue. They politicise it or they bring religion into it.

“Then, of course, when you have this kind of growth, that is the number of people coming into the workforce is far higher than the amount of opportunities that are created every year. Of course, you will have massive unemployment and what happened when you have massive unemployment: you have restless youths; you have the kind of people you don’t want to employ; employ them and they cause havoc in the society.

“If we don’t manage youth’s population, instead of having demographic dividends, we would have a time bomb, and that can blow away everybody and destroy the society entirely. The rate of growth is too fast for our good. So, government at all levels should focus on job creation, structural transformation and industrialization, where the jobs are going to come from”, he said.

He also said that the act of terrorism in the Northeast, the militancy in Niger Delta and growing kidnapping activities in Southeast and Southwest are as a result of youth unemployment.

“They are all at the centre of it. If people are employed, why would they be doing things that are harmful? For them, that’s a job. Boko Haram is paying their people. If they don’t have any money, they pay them to go and carry a gun and help them. I mean, a lot of time, the leadership feel that they don’t know what it is not having a job.

“Some people have no stake in anything and they are willing to do whatever it is to survive or to live. It is one of the major contributors, and it’s not the only one. When you have people like that, they are more easily manipulated or indoctrinated. They engage in risky behaviour.

That is why I am saying that this is something that must be addressed in a very, very urgent and very strong manner”, he said.

Efforts to get the reaction of officials in the Ministry of Labour and Productivity were unsuccessful as a recorded message from the service provider of the spokesperson, Mr. Samuel Olowookere, suggests that his phone number had been switched off, while text messages to his line were returned undelivered.

Nigeria’s unemployment rate in %

Thousands of applicants at the botched 2014 Nigerian Immigration Service (NIS) recruitment exercise where over 15 job seekers lost their lives