Economy Generated 187,226 Jobs in Q3

A man walks past job seekers as they fill out job applications for recruiters during a job fair in New YorkA man walks past job seekers as they fill out job applications for recruiters during a job fair in New York, June 11, 2013. REUTERS/Lucas Jackson
  • Economy Generated 187,226 Jobs in Q3

The Nigerian economy added 187,226 new jobs in the third quarter of 2016 (Q3 2016), from 155,444 jobs in the previous quarter, the National Bureau of Statistics (NBS) has stated.

Also, labour productivity for the quarter rose to N713.7 per hour, compared to N636.3 per hour in the second quarter.

Notwithstanding the employment generation report, which was released alongside the labour productivity index by the NBS monday, the data came amid rising unemployment of 13.9 per cent during the quarter under review.

The NBS further stated that the economy needed to generate 2.6 million jobs annually to hold down the current unemployment rate, as the country’s labour force is estimated to grow at over 2.6 million per annum.

According to the job creation report, employment generation was insufficient to meet the ever-growing labour market, leading to the continuous rise in the level of unemployment in the country.

NBS said the huge number of unemployed was a reflection of the current economic realities, as only few businesses are growing and employing while many others are shedding jobs.

It further noted that both the public and private sectors are currently finding it difficult to create jobs due to the economic crisis, adding that most states are currently finding it difficult to pay the salaries of existing workers.

According to the NBS, “In the third quarter of 2016, the total number of jobs generated rose to 187,226, from the 155,444 generated in quarter two, representing an increase of 20.4 per cent quarter-on-quarter, but a decline of 60.6 per cent year-on-year.

“The formal sector recorded 49,587 jobs, representing a 26.5 per cent share of new jobs in quarter three while the informal sector recorded a larger share of new jobs, compared to the previous quarter, reporting a figure of 144,651 jobs and representing 77.3 per cent of new jobs in quarter three.

“The public sector again recorded a negative growth in employment, with a figure of -7,012 in quarter three. The reported negative growth in public sector job numbers over the last year has not been entirely surprising, as many state governments across the country have struggled to pay salaries, hence restricting the number of new intakes and in some instances placing a complete embargo on new employment into the public service.”

The report said despite negative economic growth, net jobs created were still positive in both the formal and informal sectors as more jobs were created despite job losses especially through informal low paying jobs.

On labour productivity for the quarter, the NBS said the overall level was low, compared to the same period last year as a result of several challenges that generally impacted on output and labour, and indirectly on labour productivity, which kept it below optimal levels.

It said: “Investment in the economy was still relatively low, though some government investments were recorded during the quarter, the volume of private investment and foreign direct investments was still considerably low compared to previous years.

“Power was relatively stable throughout the quarter, which partly accounted for the increase in labour productivity. Though there was a contraction in the economy in the third quarter in real terms accompanied by an increasing unemployment rate, the growth in labour productivity implies a gradual increase in labour efficiency employed in the economy.”

The labour productivity index also showed that the agriculture sector recorded a growth of 4.5 per cent, the highest among any major economic activity, as the third quarter was the harvest season in the Nigerian calendar.

The report added that other labour intensive sectors such as human health and social services, as well as accommodation and food services, also accounted for the most jobs created in Q3 2016.

Labour productivity refers to the quantity of manpower input required to produce a unit of output. High above productivity can be an important signal of the improvement in the real income (wages of workers).

Also, the manufacturing sector of the economy recorded an expansion in new orders in December after eleven months of contraction, the Purchasing Managers’ Index (PMI) report released by the Central Bank of Nigeria (CBN), has shown.

The new orders index stood at 45.1 points in November but increased to 51.8 points in the month under review, with five sub-sectors recording expansions in new orders.

The increase was reflective of increased demand for consumer goods during the yuletide season.

The sub-sectors that recorded increased orders last month were cement; food, beverage and tobacco products; textiles, apparel, leather and footwear; paper products; and fabricated metal products.

The plastics and rubber products sub-sector remained unchanged, while 10 sub-sectors recorded a decline in orders.

Notwithstanding, the manufacturing employment index in the month of December stood at 48.6 points, indicating a drop in employment for the twenty-second consecutive month.

However, the PMI showed a slowdown in contraction in manufacturing employment, compared to the preceding month.

The report stated: “Of the 16 sub-sectors, nine recorded a contraction in employment in the following order: computer and electronic products; electrical equipment; appliances and components; printing and related support activities; furniture and related products; chemical and pharmaceutical products; primary metals; fabricated metal products; and non-metallic mineral products.”

Nevertheless, the manufacturing raw materials inventory index indicated an expansion in raw materials inventory in December at 51.6 index points.

The manufacturing and non-manufacturing PMI report on businesses is based on data compiled from purchasing and supply executives.

Survey responses indicate whether there is a change or no change in the level of business activities in the current month compared with the previous month.

New orders for non-manufacturing showed a slowing contraction in December at 46.6 index points while the composite PMI for the non-manufacturing sector declined for the twelfth consecutive month.

The index stood at 47.1 points, indicating a slowing contraction, compared to the previous month.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

Be the first to comment on "Economy Generated 187,226 Jobs in Q3"

Leave a comment

Your email address will not be published.