How a Nigerian is now regarded as unemployed

VENTURES AFRICA – In Nigeria, if you work for less than 40 hours a week, you are regarded as unemployed. This has been the formula employed by the National Bureau of Statistics (NBS) for computing unemployment statistics. However, this has now been modified to comply with the International Labour Organisation (ILO)’s definition of employment.

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According to the ILO, unemployed persons in the labour force are those who are: out of work, want a job, have actively sought work in the reference week and are available to start work in the next fortnight; or out of work and have accepted a job that they are waiting to start in the next fortnight.

“In other words, once you have been employed for at least an hour in week you will be classified as employed under ILOs definition,” said Nigeria’s Statistician General, Yemi Kale, who unveiled the new methodology for computing unemployment and revised unemployment series at a stakeholders seminar today in Abuja.

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Kale noted that if this definition was followed strictly, the unemployment rate in Nigeria, for instance, will be 2.2 percent as against the reported 23.9 percent.

“This isn’t surprising given that most Nigerians are entrepreneurial by nature and will almost definitely be engaged in some activity for an hour a week even if that activity is not sufficient to keep them engaged.”

Thus, Kale inferred that the problem in Nigeria is more of underemployment rather than unemployment.

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Under the new methodology, Nigeria’s unemployment rate will be calculated from about 65.7 million and not the entire population of the country. This is because students, voluntary housewives who cannot work or those younger than 15 or older than 65, are not regarded as part of the labour force an will therefore, not be counted.

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The new report also says that Nigerians between 15 and 65 years (or 97.49 million) were estimated as at 2013 and only 65.7 percent were “willing and able to work”.
NBS has now revised its unemployment threshold from less than 40 hours/week to less than 20hours/week. In other words, if you for at least 20 hours a week, you are not unemployed. While working 0 – 19 hours a week classifies you as unepmloyed, working 20 to 39 hours a week classifies you as underemployed and working at least 40 hours a week classifies you as employed.
In 2012, unemployment rate, when determined with the ’40hrs’ method, was 27.4 percent. However, using the new threshold ( more than 20hrs), unemployment rate in 2012 would have been 10.6 percent and underemployment rate (20-39hrs) 16.8 percent.
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Using the new methodology to compute employment statistics for the fourth quarter of 2014, 4,672,450 were unemployed (worked 0-19hrs); 13,052,219 were underemployed (worked 20-39hrs), while 55,206,940 were fully employed(worked>40hrs).
The revised methodology followed the work of a special committee constituted last year to review the existing methodology and propose a more suitable definition of unemployment in Nigeria where most of its citizens are entrepreneurial by nature. The report of the committee can be downloaded here.
Download presentation of Labour Statistics based on revised Concepts and Methodology for Computing Labour Statistics in Nigeria here.
With the new methodology now adopted by the NBS, who is an unemployed Nigerian?