Africa’s biggest economy requires 19 million jobs every year to narrow its yawning unemployment gap, Doyin Salami, chair of the Presidential Economic Advisory Council (PEAC), said on Tuesday.
“Right now, Nigeria’s economic challenge is a very significant and potentially severe one. Yes, I know our economy hasn’t performed well; we have seen so far this year a contraction in the economy, and prospects are that for the rest of the year, the economy will continue to contract,” Professor Salami said at a webinar arranged by the Nigerian Stock Exchange, the Nigerian Investment Promotion Council and Nigeria Governors’ Forum.
“If Nigeria’s economy is going to grow, investment is going to be at the heart of that growth. Up until now, our attention has typically been focused on the Federal Government especially in terms of the balance of its recurrent and capital spending.”
17 million people equivalent to 78% of Nigeria’s unemployed population lost their jobs between 2014 and 2020, the National Bureau of Statistics, said in August in its Labour Force Statistics report.
Organisations and firms have been resorting to job-cutting measures to lessen the impact of the coronavirus pandemic on business and the redundancy rate could touch30%before then end of this year, according to PriceWaterhouseCoopers, as growth in the economy slows.
Nigeria’s investment to GDP ratio is currently put at between 15 to 18%.
“If we are going to make any meaningful progress, we need an investment to GDP ratio that does not fall at any time perhaps over the next decade below 25 to 30 %t. So, no matter how we look at it, investment is going to be the fundamental catalyst for growth,” Salami said.
The PEAC head asserted that the nation’s unemployment and underemployment rate was about 54%.
“When you look at it in terms of the youth element of our labour force, it is somewhere around 64 per cent. More than half of Nigeria’s labour force is either unemployed completely or underemployed.
“Now if we are going to remedy this, Nigeria needs to be creating roughly 19 million jobs. If we are going to do that, it cannot be the responsibility of the government sector. The whole revenue profile of the government sector in Nigeria, federal and state, is somewhere around 10 per cent.”
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