CHAPTER ONE

INTRODUCTION

1.1    BACKGROUND TO THE STUDY

Unemployment, both of the educated and the uneducated manpower, has become one of the most topical and thorny issues in contemporary Nigeria. The unemployment situation has changed from previous position marked by prolonged period of unemployment and misemployment, to one in which graduates of tertiary institutions have to normally wait for a long time before getting a first job – if at all. At the beginning of this millennium, employment crisis have emerged as the most challenging issues confronting many world economies. The continuing global economic slowdown and uncertain economic prospects have resulted in a grim global economic landscape. This plunged many economies into deep recession, the ripple effects of which have affected the job markets. These effects are more pronounced in the developing and underdeveloped countries of the world, with increased unemployment being the outcome (Hassan, 2013).

Attainment of full employment mostly in the developing economies, it is agreed can reduce poverty and foster the growth of their economies. The idea is based on the linkage between income and poverty (Boateng cited in Adawo, Essien and Ekpo, 2012). Unemployment, it is also noted, generates low income or no income and therefore results in low or poor living standard. Unemployment represents wasted resources (Mankiw cited in Adawo et al., 2012). Unemployed labor has the potential to contribute to national income but are not doing so because they are jobless. Reduction of joblessness is a major concern of every responsible government all over the globe. However, given free market economies, zero unemployment cannot be guaranteed. Friction in the labor market will always be there.

Nigeria has one of the highest levels of youth unemployment in the world with 60-65% (Federal Ministry of Labour and Productivity Report, 2008 cited in Hassan, 2013). These are mostly young adults that have graduated from universities and polytechnics or institutions of higher learning. Available estimate shows that about 1.6 million persons, mostly young adult, graduate annually. In addition to this number, about 3.8 million others are certificate carrying youths that have no formal education, or have completed primary or secondary school, or dropped out from tertiary institutions all of which are annually poured into an already saturated labour market (Federal Ministry of Labour and Productivity Report, 2008 cited in Hassan, 2013).

Many of the youths are not productive and have actually been reduced to petty traders and smugglers; in many instances, the growth in the phenomenon of it is observable that unemployment rate in Nigeria has reached unacceptable dimension. Indeed, the labor market in Nigeria is dangerously close to saturation. Indeed, Ekpo (cited in Adawo et al., 2012) supports the fact that Nigeria’s unemployment situation is unacceptable.

Unemployment occurs when people are without jobs and they have actively sought for job within the past four weeks (Wikipedia, 2010). Unemployment refers to a situation where people who are willing and capable of working are unable to find suitable paid employment (Fajana cited in Emeh et al., 2012). Unemployment has been defined as a situation in which people who are willing to work at the prevailing wage rate are unable to find jobs. It is one of the macro-economic problems which every responsible government is expected to monitor and regulate. The higher the unemployment rate in an economy the higher would be the poverty level and associated welfare challenges.

Unemployment is one of the developmental problems that face every developing economy in the 21st century (Patterson et al cited in  Emeh, et al., 2012), and Nigeria is not exempted. Its impact is felt more by the youths, leading to youth unemployment. trafficking in persons and child labor can be attributed to poverty and joblessness among the youths. For a few who are able to find their way out of the country to work in other countries, their departure has contributed to depleting the quality of human capital resources in the country. It is against this background that this study is inspired to investigate the causes, implications and most importantly “Solving Unemployment Problems in Nigeria” with a special reference to Lagos State.

1.2      STATEMENT OF THE PROBLEM:

The unconducive economic conditions in Nigeria, namely lack of electricity, poor road network, poor communication system, insecurity, kidnapping, etc., have caused the close down of many companies, throwing many people into labor market. In a certain year over 100 textile factories closed shops across the country and the trend continues. Principal among other reasons for this is lack of electricity. Factories depend on generators to power their factories and this is inefficient and increases unit cost of production and makes their products uncompetitive.

Yet the country becomes a dumping ground for all manners of imports. Some other factors that account for unemployment in Nigeria include unconcerned attitude of Local Governments to create employment, non-diversification of the economy, lack of serious emphasis on skill acquisition, no serious attention is given to the informal sector to empower the sector and even outstanding corpers are still thrown to the labor market.

Another unfortunate development is that our school system produces “quarter” baked graduates, majority of them are unemployable. Most employers prefer Nigerians with foreign certificates. Nigerian universities produce graduates whose skills are suspect, making it difficult for them to be recruited. The reasons for this include admission overload, poor funding of universities and the “sorting” syndrome. Arising from the issue of poor funding followed by incessant strikes in the university system. Between 1993 and 2003, there were 9 strikes (Okebukola, 2006) culminating in a period loss of 32.75 months or approximately an equivalent of 8.2 semesters (Adawo, Essien and Ekpo, 2012).

Unemployment, underemployment and unmitigated rural-urban migration have come to characterize the Nigerian labour market. This has been compounded by frightening number of joiners as schools, polytechnics and universities churn out leavers in a geometric progression. This has impact-ted on the rate of social vices like robbery, kidnapping, prostitution, human trafficking, child abuse and unfair labour practices experienced mostly by the unemployed youths, which are other noticeable dimensions to the complexities of contemporary Nigerian employment dynamics. According to the National Manpower Board, (2009) the Nigeria labour market could barely absorb 10% of the over 3.8 million persons turned out by the Nigeria educational system on a yearly basis. In brief, the employment trends in Nigeria indicate that, without a concerted effort to tackle the problems of unemployment and underemployment the situation could get worse. Therefore this research study will articulate practical and workable solutions to this rather macro-economic evil in Nigeria with a special to Lagos State.

1.3    OBJECTIVES OF THE STUDY:

The major objective of this study is to proffer solution to unemployment problems in Nigeria. While other specific objectives include;

        i.            To find out the impact of youth entrepreneurship on job creation.

     ii.            To examine the impact of industrialization on standard of living.

   iii.            To examine the effect of unemployment on the rise of social vices.

   iv.            To examine the relationship between job vacancies and the rate of unemployment in Nigeria.

      v.            To find out the effect of unemployment on economic growth and development in Nigeria.

   vi.            To provide plausible solutions to unemployment problems in Nigeria.

1.4     RESEARCH QUESTIONS:

The undertaking of this research project will beam a searchlight on the following research questions;

1.      What are the solutions to unemployment problems in Nigeria?

2.      Does youth entrepreneurship have an impact on job creation in Nigeria?

3.      What is the relationship between job vacancies and the rate of unemployment in Nigeria?

4.      Does industrialization has impact on standard of living?

5.      What is the effect of unemployment on the rise of social vices?

1.5     RESEARCH HYPOTHESES:

The researcher intends to test the following hypotheses at 0.05 level of significance;

Hypothesis One:

Ho:      There is no significant relationship between youth entrepreneurship and   job       creation in Nigeria.

Hi:       There is a significant relationship between youth entrepreneurship and      job       creation in Nigeria.

Hypothesis Two:

Ho:      There is no significant relationship between job vacancies and the rate of   unemployment in Nigeria.

Hi:       There is a significant relationship between job vacancies and the rate of      unemployment in Nigeria.

Hypothesis Three:

Ho:      There is no significant relationship between industrialization and standard           of living.

Hi:       There is a significant relationship between industrialization and standard of         living.