kThe Nigerian Economic Summit Group (NESG) has warned that Nigeria must urgently move away from an economic growth model that increases Gross Domestic Product (GDP) without creating enough decent, sustainable jobs for its rapidly growing population.
The group said the country faces the challenge of providing jobs for an estimated three million young Nigerians who enter the labour market every year, warning that failure to do so could turn the country’s large youth population from a potential economic advantage into a major source of pressure.
NESG made the position in its agenda for the 32nd Nigerian Economic Summit (NES #32), where employment will be a major focus under the sub-theme, ‘Work Nigeria.’
According to the group, Nigeria’s population has surpassed 220 million, with almost 70 per cent of the population below the age of 35.
It said the size of the country’s young population presents both an opportunity and a serious challenge, depending largely on whether the economy can provide enough quality jobs for young people entering the labour market.
‘The difference between these two outcomes lies almost entirely in whether the economy can generate enough quality jobs to absorb the estimated three million young people who enter the labour market every year,’ the NESG said.
The group said Nigeria’s employment problem is not simply the result of temporary economic difficulties but a structural problem that has persisted despite periods of economic growth.
It noted that the economy has recorded positive GDP growth for much of the past two decades, but this has not translated into enough productive employment or improved economic security for millions of Nigerians.
According to NESG, many economically active Nigerians are either unable to find jobs or engaged in low-productivity informal activities that provide little income security and limited access to social protection. This has created a situation in which national economic growth could appear positive while many households continue to struggle to find stable, productive work.
The group said the problem is also linked to the nature of the sectors driving Nigeria’s headline economic growth. It noted that sectors such as oil and gas, finance and telecommunications, which have historically contributed significantly to GDP growth, are not labour-intensive enough to absorb workers on the scale required to address the country’s employment challenge.
NESG therefore called for a deliberate shift towards sectors capable of employing large numbers of Nigerians, including manufacturing, agro-processing, construction, creative industries and micro, small and medium enterprises.
A major part of the employment strategy proposed by the group centres on MSMEs, which it described as a critical part of Nigeria’s job-creation system. The group, citing data from the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), said MSMEs account for about 96 per cent of all businesses in Nigeria and nearly 84 per cent of total employment.
Despite this contribution, it said many small businesses are unable to reach their full potential because of difficulties in obtaining finance, high regulatory costs and inadequate infrastructure.
Power shortages, poor logistics, and weak connectivity were also identified as factors that reduce small businesses’ ability to compete and expand. NESG also said many businesses struggle to move from the informal economy into the formal sector because of the cost and complexity involved.
The group wants the country to develop practical ways of making it easier for small businesses to formalise and become more competitive. It said formalisation should not be viewed simply as a government registration exercise, because it can directly affect employment and workers’ welfare.
The NESG therefore described MSME formalisation as ‘a jobs policy’, rather than merely a bureaucratic requirement.
The group called for closer cooperation between industries and educational institutions, expansion of vocational and technical education and greater investment in digital literacy.