The World Bank has disclosed that Nigeria’s poor employment market poses both economic and security threats to the nation.
The World Bank made this remark in its bi-annual Nigerian Development Update, titled “Resilience through Reforms,” a report published twice yearly.
What the World Bank is saying
“Limited employment opportunities pose both economic and security challenges.
As in other developing countries where informality is high, Nigeria’s official unemployment rate is a poor indicator of labour market outcomes because unemployed workers receive little public support and the incentives to remain employed are compelling, even in marginal activities that generate low returns,” the World Bank reported.
The Bank added that despite agriculture serving as an employer of last resort; family farms absorbed excess labour during economic downturns; however, the periodic influx of displaced urban workers into the rural economy kept agricultural wage rates low, generating uncertainty that discouraged investment in productive capital.
“The informal service sector also provides employment, but it also typically offers low wages and limited job security or labour protection.
“In addition to their negative economic consequences, rising levels of unemployment and underemployment are both a cause and a consequence of conflict and insecurity,” it said.
The World Bank revealed that due to the nature of the economy, marginally employed workers became prime recruiting targets for criminal organizations and insurgent groups like Boko Haram.
The resulting insecurity intensified violence, according to the report, which further eroded the labour market, contributing to a vicious cycle of underemployment and instability.
“Creating adequate productive employment is thus a priority not only for economic policy but also for national security,” it urged.
In case you missed it
Nairametrics also reported that the World Bank blamed the Central Bank of Nigeria’s management of the foreign exchange regime as the reason for the FX crisis currently being experienced in the country.
