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Is Nigeria’s unemployment rate 18.8%, as widely tweeted?

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Is Nigeria’s unemployment rate 18.8%, as widely tweeted?

8th March 2018

By: Africa Check

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When an account called Spectator Index tweeted that Nigeria’s unemployment rate was 18.8%, some expressed doubt.

“That Nigeria figure is incorrect[,] trust me,” a Twitter user replied while another called it “fake data”, insisting that unemployment in Nigeria “is well over 50%”.

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Nigeria was listed third, after Greece (20.9%) and South Africa at 27.7%.

Spectator Index didn’t respond to direct messages asking for the source of its statistics. So what does available data show?

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‘Host of reasons why stats may be incomparable’

As we highlighted before, different countries measure unemployment differently. In line with the International Labour Organisation’s (ILO) definition, anyone who works more than an hour a week in South Africa is counted as employed, for example.

Nigeria has a different system. Since 2014, the National Bureau of Statistics counts people working fewer than 20 hours per week as unemployed and those working 20 to 39 hours as underemployed.

“Our previous threshold for the definition of unemployment was based on a Nigerian definition of full-time employment, which was an individual working 40 hours a week,” the country’s statistician-general said at the launch of Premium Times Dubawa fact-checking platform.

Dr Yemi Kale added that “in the UK context, this meant that the entire population of full-time workers in the UK working between 35 and 39 hours may have been considered as unemployed in Nigeria.”

Comparing unemployment data from different countries is therefore likely to be an inconsistent exercise.

“Regarding the international comparability of unemployment rates, there are a host of reasons why the statistics may not be comparable between countries,” the ILO warned.

12th consecutive rise since 2014

Nigeria’s latest unemployment data is for July to September 2017. A total of 51.1 million people was estimated to be in full-time employment during this period, or working at least 40 hours a week.

The country’s unemployment rate stood at 18.8%, as Spectator Index had tweeted. It was the twelfth consecutive rise since the last quarter of 2014. (Note: Nigeria experienced a slowdown in economic growth from 2014 and entered into a recession in 2016, only exiting it in the second quarter of 2017.)

In absolute numbers, the number of people who were unemployed had increased to an estimated 15.9 million, while the underemployed were at about 18 million (21.2%).

Combined, 40% of the country’s labour force were therefore either underemployed or had no job.

Higher share of Nigerians underemployed

Nigeria’s unemployment situation is really an issue of underemployment, Kale said.

“Many job seekers tend to try their hands at low-skill, low-wage, non-full-time jobs, just to make ends meet in the absence of any unemployment benefits or social safety net system.”

He adds that it “tells policymakers the magnitude of the problem”.

But while the number of underemployed are higher, the rate of unemployment has been growing faster than the underemployment rate.

The labour force statistics report explains that “unemployment rates worsen especially at the end of a recession and for many months after” and that unemployment trends are only expected to return to its pre-recession levels during 2018.

“Two factors explain this: Companies wait until they are convinced about the sustainability of an economic recovery before they start hiring again and many unemployed persons who had given up looking for work – and who were therefore excluded from the unemployment statistics – return to the labour market, which raises the unemployment rate.”

Conclusion: 18.8% of Nigerians jobless, but more do in-between  jobs

Doubting a widely-shared tweet, some people wondered whether Nigeria’s listed unemployment rate of 18.8% was off the mark.

However, this is the most recent rate released by the country’s statistics bureau. At 18.8%, the figure has increased steadily since 2014 when the agency changed how it counted those who were without jobs.

Nigeria seems to have as a bigger issue, though, with its underemployment rate at 21.2%. Economic growth following the country’s recession will need to be sustained before companies start hiring again.

Researched by David Ajikobi, Africa Check, a non-partisan fact-checking organisation. View the original piece on their website

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