CHAPTER
ONE
INTRODUCTION:
1.1 Background to the study
Unemployment is defined
as an economic condition marked by the fact that individuals actively seeking
jobs remain unhired. Unemployment is expressed as a percentage of the total
available work force. It is seen as a macroeconomic and sociological problem which
arises as a result of insufficient and non-availability of jobs to correspond
with the growing population. Even those who are employed, sometimes live with
the fear of retrenchment. The term unemployment could be used in relation to
all the factors of production. But in reference to labour, there is
unemployment if it is not possible to find jobs for all those who are eligible
and able to work. Labour is said to be underemployed, if it is working below
capacity or not utilized in production employment can either be
‘voluntary’ or ‘involuntary.
Voluntary unemployment
is a situation where somebody chooses not to work because they have means of
support other than employment e.g. idle rich man. Voluntary unemployment is
attributed to the individuals decision; it includes workers who reject low wage
jobs, whereas involuntary unemployment exist because of
socio-economic environment (including market structures, government
intervention and the level of aggregate demand) in which individuals operate,
involuntary unemployment include workers who are fired due to an economic
crises, industrial decline, company bankruptcy or organization restructuring
unemployment is seen as a worldwide economic problem and has been categorized
as one of the serious impediments to social progress. Unemployment is a very
serious issue in Africa (VandeMoortele, 1991 and Rama, 1998) and particularly
in Nigeria (Oladeji, 1994, Umo, 1996). The need to avert the negative effects
of unemployment has made the tacking of unemployment problem to feature very
prominently in the development objective of many developing countries.
In the study of
unemployment in Africa, Okonkwo (2005) identified three causes of unemployment;
the educational system, the choice of technology which can be either be labour
intensive or capital intensive and inadequate attention to agriculture. The use
of machines to replace work done by labour and computerization has contributed
to these social problem. Moreso, lack of enough education and skills to have
access to credit and capital.
One
peculiar feature of the unemployment problem in Nigeria is that it was more
endemic in the early 1980s than any other period. It becomes an acute problem
in Nigeria, immediately after independence. The major factor contributing to
low standard of living in underdeveloped countries is their relative inadequate
on advanced nations. Unemployment rate is given by the proportion of the labour
force that is employed divided by the total number of the labour force.
The total labour force
was projected at 61,249,485 in 2007 indicating an increase of 3.9%. total
employment in 2007 stood at 52,326,923 compared with 50,886,836 in 2006. This
represents an annual increase of 2.8%.
The labour force
consists of the number of the people aged 18 and more, who are employed (i.e.
those who do not have jobs but are actively looking, for work). Individuals who
do not fall into either of these groups such as retired people and discouraged
workers are not included in the calculation of labour force.
The International
Labour Organization (I.L.O) defines unemployment as the proportion of the
labour force which was available for work but did not work for at least one
hour in the week preceding the survey period. National Bureau of Statistics
(NBS) Nigeria defines unemployment as the proportion of the labour force that
is available for work but did not work for at least 37hours
in the week preceding the survey period. Unemployment, according to Lipsey
(1963:456) brings out economic waste and cause human suffering.
Unemployment is as a
result of the inability to develop and utilize the nation’s manpower sources
effectively. Dayomi, 1992; Osinubi, 2006. The socio-economic effect of
unemployment include fall in national output, increase rural-urban migration,
waste of human resources, high rate of dependency ratio, poverty depression,
frustration, all sorts of immoral acts and criminal behavior like robbery,
prostitution, etc. The socio-effect of unemployment brings to limelight the
need to proffer possible solutions to salvage our nation Nigeria. In Nigeria,
the ability and willingness to work is not sufficient. It is necessary for the
employed, to be registered with an employment, bureau in order to be recognized
as unemployed. The unregistered unemployment are part of the labour force and
are therefore technically unemployed. Unemployment data are obtained in Nigeria
through labour force sample survey.
The International
Labour Organization (I.L.O), realize the short-comings of the labour survey as
it effects developing economies such a Nigeria, with a large informal sector,
has encouraged a review of the methodology to incorporate
further responses to bring out the true rate of unemployment. In order to
establish the type of unemployment existing in an economy, economists have
classified unemployment as ‘fri cyclical unemployment’. Frictional u
temporarily out of work because they are changing jobs. This is unavoidable in
an economy in which both the labour force and the jobs on offer are continually
changing. Seasonal unemployment is said to occur in a situation in which people
are laid off seasonally, due to the nature of the jobs they do, e.g.
agriculture, workers in developing countries may be laid off during the growing
season. Structural unemployment is the unemployment that exist when an economy
is in more declining industries is falling. It is as a result of movement in
the natural employment rate itself, which can result from changes in labour
market institutions, demographic shift, etc, this situation is brought about by
economic variables, such a the level of aggregate demand and the actual or
expected real wage rate. Cyclical unemployment is as a result of fluctuations
around the natural employment, which can be attributed to changes in aggregate
demand.
The
main cause of unemployment in Nigeria is the outburst of population growth in
the country compared to technological growth and development in the country.
The economic growth in Nigeria has been stunted by the years of corruption,
civil war, military rule and mismanagement. It is suggested that the main
reason there is such an extent of unemployment in Nigeria is the under
utilization of the resources available.
Nigeria has a number of
abundance of diverse human and natural resources but the inefficient
utilization of these resources in order to gain the maximum economic benefits
has led to the vast amount of unemployed citizens. This unemployment has
affected the country of Nigeria and its economic climate in a number of ways.
Economic: The reduction in employment has left
citizens without purchasing power. This means that there is less of a demand
for product and services and in turn, the production and economic growth has
been hindered.
Social: Within the social effect of
unemployment in Nigeria is an increase in the rate of crime. Recent graduates
have accounted for some of the largest percentages of unemployed people who
have turned to a life in crime. Many believe that economic growth is notgoing to be the solution for the unemployment in Nigeria.
Unemployment should be addressed by providing the necessary training for people
to gain the right skill for work. Also, the concept of having a prosperous life
is something that should be worked towards and seen as a positive thing.
Experts have recommended a number of ways that Nigerians can try to decrease
the rate of unemployment.
Lack of information
also causes unemployment which is a source of unemployment that cannot be
overlook
Jobs are there, then
they will not take them, the obvious solution for this problem is to be able
make information available to the people who need it.
1.2 Statement of Problem
Nigeria has been
experiencing high level of unemployment and inflation partly because of
inefficiencies in policies implementation and the existing conflict between
those two major macro-economic variables. This situation has recently been
compounded by the increasing unemployment of professionals such as bankers,
doctors and engineers. The toll is within the productive segment of the Nigeria
population unemployment and underemployment have been one of the major problems that the Nigerian economy has being facing because a
high rate of unemployment and underemployment, a large public sector, low wage
and poor working conditions characterize the labour market in Nigeria. All of
which have combined to engender a less than cordial industrial relations in the
formal labour market.
But underemployment and
unemployment is area prominent feature of the informal labour market as well.
Consequently, the full potential of a labour surplus economy are not being fully
exploited. In the 1960s and 1970s, the Nigerian economy provided jobs for its
teaming population and absorbed considerably important labour in the scientific
sectors. The wage rate compared favourably with international standards and
there was relative industrial peace in most industries sub-group. Following the
oil boom of the 1970, there was mass migration of people especially the youth,
to the urban areas seeking for jobs. However, following the downturn in the
economy in the 1980s, the problem of unemployment started to manifest
precipatory the introduction of the Naira exchange rate and the inability of
most industries to import the raw materials required to sustain their output
levels. A major consequence of the rapid depreciation of the Naira was the
sharp rise in the general price level, leading to a weakening purchasing power
of wage earners and declining aggregate demand.
Consequently, industries started to accumulate unintended inventors and as
natural economic agents, then manufacturing firms started to rationalize their
work force. In the public sector, an embargo was placed on employment and with
the simultaneous rapid expansion in the educational sector, new entrants into
the labour market increased beyond the absorptive capacity of the economy.
Thus, the objective of the government is to achieve ‘full employment’, but it
failed to materia of unemployment from December, 1998, a total of 66.3% of male
and 62.0% of female unemployment were recorded at the urban centre. While rural
centers had an estimate of 47.1% and 45% male and female job seeker
respectively. Many people were frustrated by lack of employment opportunities
they increase those without work and those who have jobs but want to work
longer hours or more intensively, a considerable size of utility and
underutilized labour abounds in Nigeria and which aim to be brought into the
circle.
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