Recession has been defined as a situation where a country experiences two consecutive quarters of negative GDP growth rate. Alternatively, it has been described in terms of massive unemployment accompanied with rising cost of living due to inflation, a thorn in the side of every economy.
Considering the current state of the Nigerian economy, it is obvious that it is in recession. Suddenly, every Nigerian on the street has become either an economist or financial analyst, each attempting to describe in his or her terms how and why the economy is failing. Pardon me for joining this group as in this article, I’ll explain how the current recession affects the Nigerian youth corp members (whom I shall refer to as “Youth Corpers” in this article).
Salary/Allowance – Let me begin by saying that the regular monthly allowance of a youth corper (N19, 800) even during economic buoyancy was sufficient only if the corper can fast three times a week and solely rely on his or her legs as means of transportation. Now that the economy has taken a downturn, the situation is far worse. Rising costs of daily living (food, transportation etc.) has severely hampered personal budgets. Leaving most with no other choice than to reduce their standard of living. Assuming the utility of a corper was at its peak in January, now it would have reduced by almost 60 percent as more money will be needed to achieve the same level of utility or satisfaction.
Unemployment – Along with this comes the grim prospect of unemployment which is currently sweeping through the country. Companies are laying off workers, so what hope is there for the new corper or the corper about to complete his service year? And for those fortunate enough to have any kind of employment, unspeakable terms and conditions usually accompany the job.
No more savings– Leaving the financial and material effects now, the current economic situation also has negative impacts on the psychological and mental outlook of corpers. Previously, youth carpers could enthusiastically look up to the service year as an opportunity to save up some funds to start up their dream business. Any such plan now is a waste of time. Savings are a distant dream as it is a struggle to have enough to survive, not to mention thinking about savings.
Forget borrowing – Compounding matters, the current high inflation and lending rate discourages any thought of borrowing from financial institutions. This dampens the morale of anyone looking to set up a business and will in the long run kill the drive and passion for entrepreneurship among Nigerian youths.
Hard to start a business – Even though recessions are often viewed as opportunities for most Startups to thrive, starting one is now even more difficult in a recession. Most Nigerian youth corpers are resourceful and default to starting their own businesses when they do not get jobs. Some of these businesses end up blossoming into large corporations. Those who started their own businesses after service, often rely on inheritance, loans or grants from family and relatives to fund their startups. The recession makes this even harder. Apart from the fact that the purchasing power of most people have depleted severely, cost of goods and services have also increased considerably making it even more difficult to bootstrap businesses.
The Nigerian corper isn’t fully employed. He or she is in a transitioning stage and unsure of what will happen the thirteenth month after service. And right now the future looks bleak. It is exigent that the government at all levels create and properly implement meaningful policies that can stimulate economic growth among the youths. Or else, we face the depression after the recession.
God help us.
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Great article