Poverty and unemployment are some of the most diacussed challenges in Nigeria. That’s why they are both recurring campaign topics. Sometime in 2018, Nigerians woke up to the news that their country had overtaken India as the country with the highest number of extremely poor people in the world. And even though the government refused to accept the report of the World Poverty Clock, we did not need anyone to tell us we had a poverty problem.
Fast Forward to 2022: Nigeria is no longer the poverty capital of the world but still has over 80 million people living in extreme poverty. According to data cited in the maiden report of Agora Policy (‘Options for Revamping Nigeria’s Economy), poverty has continued to worsen in Nigeria. 40.1% of the population lives in poverty. The report shows the different dimensions of poverty and points at where policymakers should focus attention for them to make an appreciable difference in addressing poverty in the country.
The report confirms that the incidence of poverty is worse in the rural population, with 52.1% of them living in poverty compared to 18% of urban dwellers. It also shows how poverty is more prevalent in the North than in the south. The rate of poverty in the North-East is the highest at 71.8%, the North-West at 64.2%, North-Central at 43.5%, while the poverty rate in the South-East, South South and South West is 42.5%, 19.1% and 12.1% respectively.
This spatial disparity of poverty between the North and South can be explained by the climate change and conflict the country has experienced in recent years. The International Monetary Fund (IMF) recently reported that Nigeria and other sub-Saharan African countries experienced one-third of the world’s drought and there have been over 500 deaths due to ongoing flooding in 31 of the 36 states in the country. This aggravates poverty because the pastoral and agricultural communities in Nigeria are mainly in rural communities and operate mainly at subsistence level. Any shock to their means of livelihood drags them deeper into poverty. Conflicts, such as banditry, kidnapping and terrorist attacks, have also multiplied in recent times, displacing populations, disrupting markets, and affecting the livelihoods of Nigerians in rural communities in the North, and thus aggravating poverty.
The report also shows how more men in Nigeria are poor compared to women, no matter their level of education, and how workers in the agriculture sector seem to be the most vulnerable to poverty, followed by households with diversified income-generating activities and those engaged as apprentices or not working at all.
The story is quite similar for unemployment. Despite being a key developmental tool for fighting poverty, gainful employment has been a growing challenge in Nigeria. Economic growth, even when it is robust, has not translated into more jobs for the country’s growing labour force. The Agora Policy report shows that unemployment rates steadily increased from 2011 to 2020 from 13% to 33.3%. The spatial disparity of employment is also quite significant. People within the age bracket 15 and 34 make up 42.9% of the labour force. However, unemployment within this group rose from 8.04% in 2011 to 42.9% in 2020, this translates to 12.6 million Nigerian youths being out of a job.
The report identified rapid population growth, rural-urban migration, and rapid expansion of the educational system as some of the causes of youth unemployment. Explaining that these factors contributed to an increase in labour supply that is greater than demand. Interestingly, the growth in the working population provides a good opportunity to reap demographic dividends but could also, without adequate jobs, lead to demographic disaster.
Unemployment is also segregated along gender lines. The report shows that men make up 56.72% of the labour force. But despite the fact that there are fewer women in the labour force, more women are underemployed and unemployed. Women’s unemployment has persistently been higher. Thus, despite unemployment being a challenge for all Nigerians, women are worst hit.
The regional differences of unemployment levels across the country are also significant. In 2022, the South-East had the highest average rate of unemployment at 44.54%, followed by the South-South at 43.85%, the North-East at 41.29%, the North-Central at 29.02%, the North-West at 25.49%, and the South-West at 22.07%. Imo State has the worst unemployment rate in the country at 56.64%, and Osun State has the lowest at 11.65%. In Imo State, one out of every two people doesn’t have a job, whereas in Osun State, the proportion of the unemployed falls to about one out of every ten people.
These figures show us that Nigeria’s social crisis is rapidly deteriorating and has the potential to worsen if serious steps are not taken to change the trajectory.
To tackle unemployment and poverty in the country, the document recommends deepening critical infrastructure, in terms of improving electricity and road networks; diversifying and promoting Small and Medium Scale Enterprises through tax concessions, improving the state of security that are a threat to jobs and providing access to finance for SMEs; providing vocational training and skills acquisition programmes; revamping the educational system; improving involvement of subnational governments in anti-poverty schemes, since they are closer to the problem; and increasing investment and expenditure in Human Capital Development by improving education and providing financial literacy training to mitigate the risk of start-up failure. The report also suggests that since the prevalence of poverty is generally higher in rural areas than in urban areas, addressing rural poverty is key to reducing poverty in Nigeria.
* Idowu is a data and policy analyst with Agora Policy