Impact of Sectoral Growth on Unemployment in Nigeria

International Journal of Research and Innovation in Social Science (IJRISS) | Volume V, Issue VI, June 2021 | ISSN 2454–6186

Impact of Sectoral Growth on Unemployment in Nigeria

Obisike, Ndubueze Ezindu¹, Onwuka, Irene Nkechi², Oluwaseun B. Alade³, Udeze, R. Chike^4
1Department of Economics, Paul University, Awka Anambra State, Nigeria.
²Department of Economics, Nnamdi Azikiwe University, Awka, Anambra State, Nigeria.
³Department of Economics, University of Nigeria, Nsukka, Enugu State, Nigeria.
⁴Department of Economics, Institute of Ecumenical College of Education Enugu State, Nigeria.

Abstract: In every nation the problem of unemployment is too significant to be ignored as it is necessary in assessing the level of economic activity in a country, and one of the ways with which unemployment problems can be solved is through improvements in sectoral employment. On this note studies on impact of sectoral–unemployment nexus becomes apt. Hence this study examined the impact of sectoral growth on unemployment in Nigeria from 1997 to 2019. The study adopted OLS technique of analysis and as well subjected the data set to pre-test which include ADF unit root test, co-integration test and error correction mechanism (ECM). Based on the outcomes of the pre-test the study analysis was based on short-run estimation. From the results obtained, in the model one only the GRMER sector has the tendency to reduce RUR, in model two GRMAN and GRMER sectors exerted downward pressure on UUR and in model three GDPGR exerted upward pressure on total unemployment rate in Nigeria. From the findings of the study, we therefore conclude that government should refocus on the development of the manufacturing and merchandise sectors which are the hub of industrialisation and marketing. Government should partner with local communities to acquire mass lands that could be bequeathed to beneficiaries for commercial agriculture.

Keywords: ECM, GRMER, RUR, GRMAN, UUR, GDPGR.

I.INTRODUCTION

Unemployment rate that is above a digit in any nation is too worrisome to be ignored as it is one of the necessary phenomenon used in assessing the level of economic stability of a country. In the case of Nigeria, her unemployment rate poses a threat to her development as it has largely remained in double digits since 2000. In fact rising unemployment rate in Nigeria has constituted a bane of economic development of the country and in turn has manifested in the rising incidence of social ills among young people due to joblessness.
In addition, it is paramount to understand that the most disturbing phenomenon is that the rising unemployment persisted even in the period of sustained economic growth in Nigeria. For example, while growth rose from 3.4% in 2005 to 6.9% and 7.8% in 2007 and 2010 respectively, unemployment also rose from 11.9% in 2005 to 12.7% and 21.1% in 2007 and 2010 respectively (NBS, 2007;NBS, 2012). Theoretically, economic theory predicts that as the growth trajectory approaches the full employment level,

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