Amid ongoing discussions regarding Nigeria’s latest unemployment data, some analysts have explained how the National Bureau of Statistics could localise its methodology used to produce the new labour report.
Speaking at the “Follow the Money Series” hosted by Nairametrics on Saturday, Olumide Adesina, a financial analyst and stock market expert suggested ways the National Bureau of Statistics (NBS) should have tailored its approach to current realities before adopting the International Labour Organization (ILO) standard.
- He elaborated, “It doesn’t make much sense for a country that doesn’t pay hourly wages to suddenly adopt the new methodology. Wage growth is sluggish in Nigeria, and many people are underpaid. We need data to capture details such as how many Nigerians earn above N150,000 and how many can meet their basic financial obligations, for instance.”
Speaking further, he explained that employers are more interested in data relating to wage ranges rather than what the NBS data shows.
- “One of the primary objectives of such data is to reflect the strength of the economy. The majority of those employed in Nigeria belong to the informal economy, amounting to 92.6%.”
More gaps, What could NBS learn from the Western market?
Adesina urged the NBS to draw inspiration from successful practices in Western markets, saying since they are adopting ILO standards, NBS should focus on aspects such as, “wage growth, payroll statistics, and active participation. According to Bloomberg, six companies dominate ten sectors of Nigeria’s economy, so collecting such data should not be challenging. It would provide us with valuable insights into the economy’s performance. We currently lack information about the impact of the subsidy removal, as the data only covers the first quarter of 2023. These are questions that we need to pose to the esteemed NBS,” he said.
Uade Ahimie, Head of Strategy and Public Affairs at Nairametrics, expressed concerns about the small demographic sample used, making it difficult to ascertain the report’s accuracy.
- He commented, “The number of households used to compile this data represents only about 3% of the entire population. It is perplexing how we arrived at this point, especially when the initial plan was to provide palliatives to 12 million households.
- “Additionally, considering the absence of an hourly wage structure in Nigeria, has the NBS factored in the N30,000 minimum wage and calculated its equivalent hourly rate?
- “Have we compared this to hourly pay rates across the continent? Shouldn’t the NBS engage with the government to discuss the need for a review of unemployment wages? These are crucial questions that demand answers.”
What you should know
On Thursday, August 24, 2023, the National Bureau of Statistics (NBS) released its latest labour force report, marking a significant two-year gap since the previous one.
The report revealed a substantial decline in Nigeria’s unemployment rate, standing at 4.1% in Q1 2023, in stark contrast to the 33.3% recorded in Q4 2020.
These figures have prompted skepticism, with many arguing that they do not accurately reflect the grim realities of the Nigerian job market. Critics attribute this discrepancy to the challenging economic environment, characterized by high inflation, FX shortages, and escalating operating costs.
