Unemployment major problem as GDP grows at 3.4%

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Bismarck Rewane, Chief Operating Officer (COO) of Financial Derivatives Company (FDC) Limited has said unemployment has become a major problem with Gross Domestic Product (GDP) growing at 3.4 per cent, while labour productivity is growing at merely 1.7 per cent.

“Unemployment has become a hydra headed problem. Almost every presidential candidate, at last count 95 of them, have unemployment among top three issues to be resolved. But wait a minute, how do you solve a problem without a dimension. How do you determine a value in a simple or quadratic equation without the unknown parameters?

“The last time unemployment data was released was two years ago (second quarter of 2020), even before then, there was a gap. Gross Domestic Product (GDP) is growing at 3.4 per cent while Labor productivity in Nigeria is 1.7 per cent. This implies that there is high level of underemployment, low productivity and endemic unemployment crisis”, said Rewane in the recent FDC Bi-Monthly Economic and Business Update released yesterday.

He said, Nigeria, like most developing countries, is experiencing a youth bulge. This age-cohort pattern is usually experienced when countries succeed in reducing infant mortality while keeping fertility rate high.

However, Nigeria is failing to harness its youth bulge. Instead of demographic dividend, the country is on the path of harvesting demographic crises from its youth bulge. Young persons between the age of 15 and 34 years make up 43 per cent of the labour force in Nigeria with nearly half of the youth labour force been unemployed based on NBS 2020 survey.

Although Nigeria has wasted a substantial share of its golden era, there are vast opportunities for exploiting the demographic dividends that youth cohort can offer. These include prioritizing human capital development, creating and harnessing youths to economic opportunities and creating conducive environment for efficient markets.

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