IMPACT OF POPULATION GROWTH ON UNEMPLOYMENT IN NIGERIA: AN EMPIRICAL ANALYSIS ABSTRACT
Economists overtime have attributed population explosion as one of the chief causes of unemployment in developing economies. This study examines the impact of population growth on unemployment rate in Nigeria between 1985 and 2015. The study adopted the econometric techniques of the unit root test, cointegration test, multivariate regression analysis and the pair-wise granger causality test for the analysis of data. The results revealed that population growth rate; per capita income and unemployment rate except total population became stationary at the first-order difference. It was also found that a long-run equilibrium relationship existed between population growth and unemployment. Furthermore, the regression result showed that population growth rate, total population and per capita income significantly and positively contributed to unemployment situation in Nigeria within the period estimated. The study later proffered various policies options which the government can implement to address the issue of unemployment, curb high population growth rate and achieve higher living standards for its populace.
CHAPTER ONE
1.1 BACKGROUND TO THE STUDY
Nigeria is the most populous nation in Africa and the 8th in the world with an estimated figure of about 170 million people based on the facts released by the National Population Commission (NPC, 2012). In addition to this, the nation boasts of being the largest economy in Africa as the GDP figure for 2013 and 2014 stood at N13, 526.25 and N14, 475.38 billion respectively (Economic Watch, 2015). Despite these magnificent feats, the country is still faced with several developmental, economic and political challenges such as unemployment, poverty, corruption, income inequality, population explosion and political instability.
Nigeria has a growing population, which can equally be referred to as increasing population. The census conducted in Nigeria in 1991 put Nigeria’s population at 88.9 million people with growth rate of about 3% and the total fertility rate as disclosed by the Post Enumeration Survey (PES) at about 6%. From the statistics obtained at the 2006 Nigerian population census, Nigeria’s population stood at 140,003, 542 (NBS, 2009). The growth rate then was less than 3% and the population has the tendency of doubling itself in less than 23 years (Odusina 2013). The United Nations estimated Nigeria’s population to be around 150,003, 400 and further corroborated that Nigeria’s population is the largest in Africa and ranked 7th among the populous countries globally (United Nations, 2009).
The population of Nigeria is rising rapidly. A rapid rise in population can be attributed to three main factors which are birth rate, death rate and migration (Yesefu, 2002). In the Nigeria population experience, migration has not contributed to rapid population, because most of Nigeria’s technocrats, experts and professionals immigrate to other countries for an improved means of livelihood (Odusina, 2013). If a rising population is brought about as a result of increase in birth rate, there will be larger proportion of children and young people in the population. On the other hand, if rapid population is a result of decrease in death rate, the adults and older people will constitute a larger percentage of the total population. Furthermore, if a rising population is due to high net migration, the population will constitute a large proportion of the economically active people, between the ages of 15 and 60 years. According to National Demographic Health Survey (NDHS, 2003), crude birth rate in 1990, 1991 and 2003 stood at 39.0, 44.6 and 42.0. This evidences that Nigeria’s rapid population is primarily as a result of high birth rate.
The population of Nigeria has gathered momentum over time. Population will continually increase event if there is usage and practice of contraceptives, family planning system and birth control. Increasing population is a burden to the government especially in less developed countries, which is considered injurious to the citizenry living standard and the socioeconomic development of the country. Unemployment occurs as a result of the insufficiency of jobs to commensurate with the growing population, even those who are employed live with the fear of being rendered unemployed due to job insecurity, economic recession and retrenchment of workers. (Akiri etal. 2016). The term ‘unemployment’ can be applied to any factor of production that is idle and under-utilized. With precise application to labour, unemployment occurs when active and able-bodied men are actively seeking jobs but unable to find one. Underemployment is a variant of unemployment which arises when labour is working below full capacity or not fully utilized in production.
Unemployment has been a hindering factor to the attainment of sustainable development. In Nigeria, unemployment is more prevalent among the youths. Every year, tertiary institutions turn out thousands of graduates in large mass with no absorptive capacity in the labour market. Moreover, young people are more likely to be employed in jobs of low quality, poor working conditions, poor remuneration and engagement in dangerous works or receive a short term informal employment arrangements. Unemployment has been regarded as global economic problem and has been tagged as a barricade to social and economic advancement especially in developing nations, Nigeria inclusive. Unemployment tantamount to huge wastage of a country’s human resources, generates welfare loss in terms of social output, leads to low income and increases the cost of living ( Umo, 1999). The inadequate employment situation of youths has resulted into a number of socio-economic, moral and political vices such as armed robbery, thuggery, vandalisation of government assets, corruption, prostitution, rural-urban migration, high dependency ratio, frustration, corruption, depression, wastage and underutilization of human resource. The prevalence of unemployment has birthed the presence of poverty in the nation. Successive government has employed several strategies to curb both challenges, but the results achieved so far have not been remarkable.
1.2 STATEMENT OF PROBLEM
Nigeria is bedeviled with a dual-problem of high population and high unemployment. The jobs available in the labour market are not commensurate with the teeming number of unemployed persons. Rapid population growth is inimical to the economic and social development of a country. There will be little time or no time to adjust the economy to development efforts. Increasing population has the tendency of eroding the benefits of economic development and producing disastrous effects on living conditions of the citizenry if not properly checked. Nigeria population requires urgent attention, regulation and control due to its excessive growth rate. Nigeria need to learn from the Chinese population experience, when the latter country encountered many challenges linked to population growth. A large number of people lived in poverty; they were unable to deal with the aftermath of flood and drought. This occurred because the Chinese government never made any strategic plan to avert the ugly incident (Clunas, etal., 2008).
The population situation of Nigeria and issues related to it needs to be discussed to expose many population-related factors to the consciousness of the people. For instance, Nigeria is suffering from high rates of poverty and unemployment. Moreover, there is mass migration of people from rural areas to urban areas, thereby creating social vices. This is because the available industries are unable to employ all the participants in the labour market. For Nigeria to overcome these developmental challenges, effective policies need to be formulated to raise domestic production of food, create jobs; reduce absolute poverty, lower population growth amongst many other things.
1.3 OBJECTIVES OF THE STUDY
The objectives of the study are:
. To examine the impact of population growth on unemployment in Nigeria.
. To ascertain if there is long-run equilibrium relationship between population growth and unemployment in Nigeria.
1.4 RESEARCH QUESTIONS
The study is targeted to providing satisfactory answers to the following research questions:
What is the impact of population growth on unemployment in Nigeria?
Is there long-run equilibrium relationship between population growth and unemployment in Nigeria?
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