Asianet Pakistan Private Limited

Nigeria’s economy is running on a ‘survivalist’ mode, as 93 percent of the nation’s workforce is trapped in informal employment, according to a report.

The findings are based on the 2025 report by the Nigerian Economic Summit Group (NESG) entitled ‘From Hustle to Decent Work: Unlocking Jobs and Productivity for Economic Transformation in Nigeria.’

The report highlights that there is an overwhelming reliance on informal work, often ‘survivalist’ activities which are actively hindering national development and poverty reduction.

Analysis reveals that 81 percent of Nigerian workers are concentrated in sectors such as subsistence agriculture and retail trade, which offer very low productivity.

The jobs, in particular, range from petty trading and informal transport to roadside services engaged by millions of Nigerians.

These forms of work offer severely limited opportunity for productivity gains and income mobility.

According to Musa Yusuf, founder of the Centre for the Promotion of Private Enterprise, ‘Those are the people sustaining the economy through creativity, resilience and hard work. Yet, from a policy point of view, the informal sector receives little serious attention.

‘If the sector delivers over 90 percent of jobs, what is the policy framework to support it? Many operators are harassed as markets are demolished, artisans displaced, mechanics taxed and fined.Their contribution to the economy is over N60 trillion, dominant in trade, agriculture and blue-collar work.’

In a similar vein, Chinwe Egwim, Eeconomist and banker, noted: ‘It’s not surprising that over 90 percent of jobs are in the informal sector. Many Nigerians lack the necessary skills and education to fill roles in the formal sector, leading to high underemployment.’

The productivity trap

According to the report, the scale of informal work is directly linked to Nigeria’s long-standing struggles with low labour productivity.

For nearly three decades, from 1990 to 2018, Nigeria’s labour productivity growth averaged a meagre 1.5 percent and has since been in decline.

This contrasts sharply with nations such as Indonesia and Malaysia, which saw gains of 2.5 percent over the same period, demonstrating the potential for growth with sustained economic reforms.

This deeply entrenched issue is compounded by persistent national crises, including inadequate infrastructure, erratic power supply, low industrial output, and widespread insecurity.

The shrinking formal sector

The root cause of the informal explosion is the inability of the formal private sector to generate adequate jobs, the report said.

Over the last decade (2015-2024), macroeconomic instability marked by two economic recessions – a volatile currency, and soaring inflation – have increased the cost of doing business, constraining firms’ capacity to expand and hire.

Formal jobs accounted for a meagre 7.8 percent of total employment as of 2023, according to the National Bureau of Statistics (NBS, 2024), which underscores a weak private sector.

Furthermore, only 15 percent of all employed Nigerians are wage earners, meaning 85 percent are self-employed, often operating outside the protection of formal labour laws.

This labour market is strained further by an estimated 3.5 million young Nigerians entering the workforce annually. Many are forced into underemployment, taking on roles like PoS operations and informal transport gigs that are below their potential.

Regional disparities

The crisis is not uniform across Nigeria, and regional disparities highlight the uneven economic landscape.

While states such as Lagos, the Federal Capital Territory (FCT) and Oyo show the highest shares of wage earners (Lagos at 33.8 percent, FCT at 27.2 percent), indicating a relatively stronger, albeit still insufficient, the northern states tell a different story.

The northern states such as Jigawa (3.3 percent), Sokoto (3.8 percent), and Kebbi (4.6 percent) have the lowest shares of wage earners, highlighting a heavy reliance on government and informal activities for employment.

Skill deficit and talent migration

Exacerbating the job crisis is a severe skills deficit.

Employers report struggling to find workers with the necessary technical and soft skills such as problem-solving and digital literacy for the few mid-productivity jobs that are available.

An emerging and compounding problem is ‘japa,’ the increasing migration of skilled Nigerian workers.

Professionals in medicine, ICT, finance, and professional services are leaving for countries with better pay and working conditions, creating a growing talent gap that further weakens the capacity of domestic firms to grow, innovate, and compete in a low-productivity environment, the report noted.

The informal sector, which climbed to 93 percent of total employment in the second quarter of 2024, has dire national implications. Firstly, limited revenue mobilisation is a key consequence, as informality undermines the government’s ability to collect taxes effectively.

Unlocking Nigeria’s potential hinges on fundamental structural reforms aimed at strengthening the formal private sector, addressing the skills gap through education investment, and creating a macroeconomic environment that incentivises business expansion and, crucially, the creation of decent, high-productivity jobs at scale.

Similarly, Egwum advised, ‘We need to strengthen education and skills acquisition, while investing more in the blue-collar economy. If sectors such as plumbing, welding, and similar trades are better structured, we would see these numbers decline significantly.’

Nigerian households are facing a fresh wave of hardship as the price of liquefied petroleum gas (LPG), commonly known as cooking gas, surges to record highs following supply disruptions that have worsened the country’s energy affordability crisis.

Across major cities, consumers now pay between N1,500 and N3,000 per kilogramme (kg), up from the average of N1,200 just weeks ago. In Lagos, Abuja, and Ogun, many outlets have run out of stock, while others still in operation sell at rates far above official prices.

Several families have resorted to using kerosene stoves to cope with the hardship, while others have turned to charcoal, BusinessDay gathered.

Households feel the heat

The sudden jump in prices has left families struggling to adjust their daily budgets.

‘My mum sent me a text yesterday, saying her friend bought gas for N2,500 per kg, while we had just bought ours for N2,000,’ said Stella Chibuike, a resident of Ikorodu, Lagos.

‘Our usual vendor later called to say the price had dropped to N1,500. It’s still higher than the N1,300 we used to buy, but at least it’s better than before.’

In Sangotedo, Doris Akintunde, a resident, said she paid N1,500 per kg and was ‘grateful’ it hadn’t hit N2,000. ‘Normally, I buy per kg of gas for around N1,000 or N1,300, but with this hike, I was expecting worse,’ she said.

Also, restaurants and small food businesses have not been spared.

‘I got my cooking gas for N1,500 per kg, but it didn’t last,’ said Oluchi Phina, who runs a restaurant in Iganmu. ‘My cylinder was filled with air, I was cheated. This has become common at some outlets.’

Kubwa, Abuja-based Muhammad Turaki, said he bought gas at N2000 per kg, noting that the price hike has squeezed his family income.

‘I paid N25,000 for 12.5kg of gas at the weekend. I spent almost double the price I used to pay for it. As a result, I didn’t buy petrol to power my generator,’ he said.

These accounts illustrate how price volatility and under-dispensing are exacerbating the pain of consumers already struggling with inflation.

Prices double nationwide

Findings by BusinessDay show that the price of a 12.5kg cylinder, which sold for between N14,000 and N17,000 in September, now costs up to N25,000 in some parts of Lagos, Ogun and the Federal Capital Territory (FCT).

Consumers have been forced to queue for hours at filling plants, with some travelling long distances to find gas. In Abuja, a resident of Nyanya said she paid N20,000 for a 12.5kg refill after visiting four stations.

‘I’ve never seen a cooking gas queue in my entire life – this is the first time,’ Moris Monye, a businessman, said on X (formerly Twitter).

Another X user said, ‘A 20 kg used to go for 4,500 as ‘recent’ as 2021. And things were already terrible then. Many Nigerians are strong.’

Industrial strike and logistics snags

The Nigerian National Petroleum Company (NNPC) Limited attributed the crisis to the recent strike by members of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), which disrupted operations at key terminals, including the Dangote Refinery, a major LPG supplier.

According to Bayo Ojulari, NNPC’s CEO, the industrial action delayed gas loading and transportation for several days, creating what he described as ‘temporary but artificial scarcity.’

‘Once the strike was suspended, normal supply began resuming,’ Ojulari told Channels Television on Monday.

However, marketers say the challenges go beyond labour unrest. They point to foreign exchange (FX) volatility, high transport costs, and inadequate storage capacity as structural bottlenecks that continue to distort pricing.

Dangote’s intervention

According to reports, the Dangote Petroleum Refinery, which produces about 2,000 tonnes of LPG daily, has cut its ex-depot price from N810 to N760 per kilogramme to ease market pressure and discourage profiteering.

The refinery’s management warned that it may resort to direct sales to consumers if middlemen continue to inflate prices, according to multiple reports. The move is expected to stabilise supply in the coming days, though retail prices may take longer to reflect the reduction.

Meanwhile, the federal government has held talks with LPG marketers and PENGASSAN officials to ensure steady product flow and prevent a repeat of the disruption.

Inflation and energy poverty concerns

The surge in cooking gas prices adds to Nigeria’s cost-of-living pressures. Headline inflation stood at over 30 percent in September, with food inflation rising even faster, according to the National Bureau of Statistics (NBS).

Analysts say the crisis could worsen energy poverty as low-income households revert to firewood and charcoal, reversing gains in clean cooking adoption and raising health and environmental risks.

‘If gas doesn’t come down, we’ll all go back to firewood,’ said a Lagos resident interviewed by BusinessDay. ‘Even charcoal is now expensive because everyone is rushing to buy it.’

Eyo Ekpo, an energy policy analyst, said the episode exposes Nigeria’s overreliance on imported LPG and weak domestic logistics.

‘We need a more resilient gas infrastructure and pricing framework. Otherwise, any small disruption, a strike or a transport delay, can trigger a nationwide shock,’ he said.

Call for long-term solutions

A coalition of prominent Nigerians has outlined a series of long-term solutions to avert future industrial disputes in Nigeria’s refining sector, following the recent labour dispute at the Dangote Refinery.

In a joint statement signed by respected leaders, including Bishop Matthew Kukah, Khalifa Muhammad Sanusi II, Atedo Peterside, Arunma Oteh, and Aisha Yesufu, the group commended the federal government, labour unions, and the Dangote Group for resolving the refinery dispute through dialogue, rather than confrontation.

They urged that this peaceful resolution serves as a model for managing future industrial relations in the country’s energy and manufacturing sectors.

The signatories emphasised that structured dialogue remains the cornerstone of sustainable industrial harmony. While reaffirming workers’ constitutional right to organise and demand fair treatment, they cautioned against industrial actions that could destabilise strategic national assets.

A wake-up call

For households like Stella’s, Doris’ and restaurants like Phina’s, the crisis has been more than an inconvenience; it has upended daily life and strained already thin budgets.

‘If this continues, I might have to close my restaurant,’ said Oluchi Phina. ‘People can’t pay more for food, and I can’t afford to cook.’

Prateek Suri was visiting a university campus in Zambia when he noticed something that didn’t add up. Dropout rates were climbing, but not for the usual reasons. Students weren’t failing academically-they were exhausted. Many lived miles from campus because rent nearby was unaffordable. Some were sleeping on floors. Others had quit entirely.

‘It wasn’t about intelligence,’ Suri said quietly. ‘It was about distance – and the cost of proximity.’

That observation led to one of MDR Investments’ more unusual projects: working with the Zambian government to build affordable student housing, solar-powered, with libraries and Wi-Fi included. MDR has secured a memorandum of understanding from the Zambia Development Authority to explore joint initiatives in student housing, mining, and infrastructure development. When the first students got their keys, Suri says something shifted in how he thought about the business.

‘It was hope, not just housing,’ he said. ‘That’s when capital with conscience stopped being an idea and became a practice.’

MDR is part of the Maser Group, a $5 billion conglomerate investing in mining, infrastructure, roadways, shipping, and artificial intelligence across the African continent. Suri founded MDR, knowing that Africa doesn’t reward quick wins. He learned that the hard way.

The $65 Million Lesson

MDR’s first major deal nearly turned into a disaster. The firm had committed to a $65 million acquisition of a shipping company in West Africa. It was ambitious for a new player in a region known for complicated negotiations and rules that shift mid-process. Halfway through, after MDR had already put down a substantial deposit, the seller tried to change the terms.

‘We were looking at a potential disaster,’ Suri recalled. ‘It wasn’t just money at risk; it was credibility.’

The deal only survived because the local government stepped in to mediate. It went through in the end, but the details of that mediation remain unclear. What concessions, if any, did MDR make? Suri frames it as a lesson in patience and relationship-building.

‘That was my real crash course in Africa,’ Suri said. ‘Money gets you to the table, but relationships and patience keep you there. You can’t shortcut trust.’

It’s a lesson many foreign investors claim to have learned. Whether MDR applies it more consistently than others is difficult to assess from the outside.

The refusal to ‘strike gold’

A few years later, MDR was looking at gold. Literally. A mining opportunity in West Africa, the kind that makes investors sit up straight. The numbers were excellent, mining was already in the portfolio, and the opportunity was obvious.

Except the communities living near the site were protesting. Water sources had been contaminated. Safety protocols were being ignored or didn’t exist.

Suri’s team spent weeks assessing whether new management could turn it around. They kept arriving at the same answer: probably not. The problems went too deep.

‘I remember sitting with the reports and thinking, do I really want to build wealth on poisoned ground?’ he said.

Not everyone at MDR agreed with walking away. Some thought it was a mistake, that the risks could be managed, that the returns justified the effort. Gold is gold, after all. But Suri held the line.

‘Sometimes,’ he added, ‘the best deal you’ll ever make is the one you don’t sign.’

He references the decision frequently now, though he won’t say which mine or which country. The contamination levels, the projected yields, the names of the communities involved-all remain unspecified. Mining operations with active protests carry reputational risk, and regulatory risk, and the kind of operational friction that can erode margins regardless of how the spreadsheet looks at the start.

Whether the choice was conscience or calculation, it established something. There are deals MDR won’t touch, even when they’re made of gold.

Turning Chaos into Method

Suri doesn’t romanticise the work. Ask him about operating in Africa and you get a list of headaches: regulations that change midstream, currencies that collapse overnight, infrastructure that doesn’t exist.

‘Africa will test you every single day,’ he said. ‘Regulations change midstream, currencies tumble overnight, and sometimes there’s not even a road to the site you’re funding.’

These are real challenges, though framing them as unique to Africa risks reinforcing tired narratives about the continent as uniquely chaotic. Regulatory uncertainty and infrastructure gaps exist in plenty of markets-Africa just doesn’t have the financial cushions or institutional backup systems to absorb the shocks.

Suri argues that the instability is precisely what makes the region interesting. Investors who need certainty will never make it. The ones who succeed learn to read between the lines, build relationships before signing contracts, and think in decades instead of quarters. Credibility comes from actually delivering.

‘If you’re waiting for the environment to be perfect, you’ll wait forever,’ he said. ‘Sometimes, you build the road before you build the project.’

MDR has literally funded road construction to access project sites.

Not Charity

MDR also works through the African Financial Federation (AFF), part of the Maser Group, which backs young entrepreneurs in tech, agriculture, and healthcare. Suri describes it as investing in people, not just infrastructure, though he’s quick to point out it’s not charity.

‘Africa doesn’t lack talent,’ he said. ‘It lacks the trust and capital that allow that talent to grow. We try to bridge that gap.’

The AFF is less visible than MDR’s infrastructure work, and Suri doesn’t volunteer specifics about portfolio size or outcomes. What’s clear is that it represents a smaller share of the firm’s activity than the headline projects.

Suri pushes back on the idea that this is purely altruistic. In his view, doing good and making money aren’t opposed-they’re linked, at least in the long term.

‘Ethics without structure is charity,’ he said. ‘But structure without ethics is exploitation. The goal is to live in the middle – where doing good and doing well reinforce each other.’

‘When the Numbers Get Bigger’

‘The real test,’ he said, ‘is whether you stay principled when the numbers get bigger.’

He’s right about that. MDR is still relatively small. The Zambia housing project, however symbolic, doesn’t compete with the scale of the firm’s mining and logistics deals. As the firm grows, so do the pressures-from investors, from partners, from the market itself.

Suri brings up the housing project often, perhaps because it offers a clear answer to what MDR stands for. Most of the firm’s work involves less photogenic decisions: which partners to trust, which regulatory risks to accept, which communities to engage and which to merely compensate.

‘The purpose of capital,’ Suri said finally, ‘is not just to multiply wealth. It’s to multiply impact. That’s the only kind of growth that lasts.’