The National Bureau of Statistics (NBS) released its revised methodology yesterday, revealing a 4.1% unemployment rate in the first quarter of 2023, down from 5.3% in the preceding quarter.
However, this revision has ignited criticism and raised concerns among analysts.
Critics argue that the new methodology, although aligned with the International Labour Organisation (ILO) standard, may not offer an accurate reflection of Nigeria’s unemployment situation.
They fear it could mislead policymakers and the government, preventing effective responses to this critical socioeconomic issue.
The Statistician-General of the Federation and Chief Executive of the NBS, Semiu Adeniran, emphasized that the updated numbers don’t alter the grim reality of unemployment in the country. He urged the government not to become complacent in addressing this pressing challenge.
The revised methodology highlights that a significant portion of employed individuals in Nigeria work less than 40 hours per week, with underemployment rates at 12.2% in Q1 2023. Self-employment and farming activities remain dominant sources of income for Nigerians.
Despite the reduction in the unemployment rate, experts caution that the change in methodology does not necessarily represent an improvement in the employment landscape.
According to the ILO definition, underemployment remains a significant concern, standing at 21.2% in Q1, compared to 13.7% in Q4 2022.
However, some have expressed reservations about the new methodology and argue that international comparability should not overshadow the relevance of data for policymaking.
They stress the importance of aligning government objectives with the data collected by the NBS.
The Centre for Social Justice (CSJ) vehemently rejected the NBS findings, claiming they do not reflect the reality of Nigeria’s economic challenges.
The CSJ calls on the government to create more decent jobs and improve the livelihoods of its citizens.
Wealth Management and Business Development Consultant, Mr. Ibrahim Shelleng, believes that the revised methodology offers a better understanding of unproductive segments of the population.
Still, it may underestimate the scale of unemployment and underemployment in Nigeria due to its focus on productive output over hours worked.
President of the Association of Capital Market Academics of Nigeria, Prof. Uche Uwaleke, expressed concerns about the low sample size and the inclusion of apprentices in the new methodology, suggesting it could lead to erroneous policy decisions.
The debate over the methodology underscores the importance of ensuring that data aligns with the unique conditions prevalent in the country to facilitate effective policy responses to unemployment.