Untangling Unemployment Dynamics: A Study of Nigeria's Labour Market
Main Article Content
Abstract
One of the prominent and pressing challenges confronting Nigeria revolves around the pervasive issue of unemployment. To delve into the roots of this predicament, this study adopts the Autoregressive Distributed Lag (ARDL) bound approach, leveraging time series data spanning from 1990 to 2022. The independent variables considered in the model encompass inflation rate (INF), Gross Domestic Product (GDP), education (EDU), labor force participation rate, total government expenditure (TGE), and exchange rate. The Unit Root test outcomes reveal a mixture of I(0) and I(1) series, necessitating the utilization of the ARDL approach. Notably, the research findings spotlight INF, GDP, EDU, and TGE as negatively and significantly influencing unemployment (UNEM) both in the short and long run. However, EDU is identified as an insignificant factor in the long run, while exhibiting a positive influence in the short run. In light of these results, it is recommended, among other strategies, that efforts be concentrated on enhancing labor market flexibility. Policy makers are encouraged to explore initiatives that bolster the adaptability of the workforce. This could involve the implementation of comprehensive training programs aimed at equipping workers with new skills and facilitating seamless labor mobility across various sectors. Furthermore, the study suggests the implementation of policies supporting a more flexible exchange rate regime to counter potential adverse long-term effects on unemployment. In essence, this research underscores the imperative for multifaceted solutions to address the multifaceted challenge of unemployment in Nigeria, emphasizing the enhancement of labor market dynamics and the formulation of policies conducive to economic resilience and adaptability. Key words: , ,
Downloads
Article Details
Section
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Share
References
1. Adegbite, O., & Adegbite, O. (2021). The emerging Nigerian economy. Perspectives on industrial development in Nigeria: Issues, challenges and hard choices, 1–20.
2. Alenda-Demoutiez, J., & Mügge, D. (2020). The lure of ill-fitting unemployment statistics: How South Africa’s discouraged work seekers disappeared from the unemployment rate. New Political Economy, 25(4), 590–606.
3. Aqul, A., & Seemab. (2014). Determinants of unemployment in Pakistan. International Journal of Physical and Social Sciences, 10(14), Issue 4. ISSN: 2249-5894.
4. Audretsch, D. B., Lehmann, E. E., Menter, M., & Wirsching, K. (2021). Intrapreneurship and absorptive capacities: The dynamic effect of labor mobility. Technovation, 99, 102129.
5. Kartini, S. Y. D., Astuty, P., & Wibawa, H. W. (2023). Determinants of unemployment in Sumatra. International Journal of Current Research and Applied Studies, 2(3), 1–14.
6. Keynes, J. M. (1936). The general theory of employment, interest and money. London: Macmillan and Co., Ltd.
7. Kiley, M. T. (2022). Unemployment risk. Journal of Money, Credit and Banking, 54(5), 1407–1424.
8. Ndubuisi, P. (2017). Analysis of the impact of external debt on economic growth in an emerging economy: Evidence from Nigeria. African Research Review, 11(4), 156–173.
9. Onwioduokit, E. A. (2013). Unemployment and economic growth in Nigeria: An empirical re-examination. Bullion, 36(3), Article 12. [Link to the source]
10. Samuel, U. D., Odo, E. S., Atewologun, O. M., Adeyeye, A. A., & Olaegbe, T. D. (2021). COVID-19 pandemic: Health challenges and a critical study of the structure of the Nigeria economy. Path of Science, 7(11), 4001–4021.
11. Sahoo, M., & Sahoo, J. (2019). The relationship between unemployment and some macroeconomic variables: Empirical evidence from India. Theoretical & Applied Economics, 26(1).
12. Sinan, O. B. (2022). The relationship between the exchange rate, inflation, and unemployment in Turkey, 2014–2021.
13. Statista. (2023a). Nigeria: Unemployment rate from 2003 to 2022. [Link to the source]
14. Statista. (2023b). Unemployment rate in the United Kingdom (UK) from 1999 to 2022. [Link to the source]
15. Tunah, H. (2010). The analysis of unemployment in Turkey: Some empirical evidence using cointegration test. European Journal of Social Sciences, 18(1), 18–38.
16. Udeaja, E. A., & Onyebuchi, O. K. (2015). Determinants of economic growth in Nigeria: Evidence from error correction model approach. Developing Country Studies, 5(9), 27–42.