Impact of Unemployment on National Output in Nigeria, 1980-2011

Journal of Economics and Management, 2019

Aim/purpose-This study investigates the links between unemployment, poverty and economic growth in Nigeria between the periods, 1985-2015. Design/methodology/approach-The paper employed the Augment Dickey Fuller test for unit root test, Johansen cointegration for cointegration, Ganger causality for causality test and Error Correction Model to establish the short-run links between the variables. Findings-The unit root test result revealed that the variables trend with time indicating their failure of integration at level. However, they were found to be stationary at first difference. The causality result revealed that there is no causal relationship between unemployment, poverty and growth in Nigeria. Similarly, the cointegration results showed that there is no long-run relationship between unemployment, poverty and economic growth in Nigeria. The short-run parameter estimates indicated that unemployment has a negative and significant relationship with growth. However, the coefficient of the interaction between unemployment and poverty is positive and significant at the conventional level.

American Journal of Applied Statistics and Economics

This study investigates the trends and effects of unemployment on economic growth in Nigeria using secondary data from relevant institutions for analysis from 2010 to 2020. The Auto Regressive Distribution Lag (ARDL) bounds test methodology is utilized to determine the long run relationship between unemployment and economic growth. The empirical findings using the ARDL Model confirmed that there exists an inverse relationship between economic growth and unemployment, and that unemployment leads to increasing crime rates in both short and long run.

This research work investigates the relationship between inflation, unemployment and economic growth in Nigeria (1980-2014). The objectives of the study is to examine the short run and the long run relationship between inflation, unemployment and economic growth in Nigeria. It begins with the application of Augmented Dickey-Fuller techniques to examine the unit root property of the time series data after which Autoregressive Distributive Lag Model (ARDL) was used to determine the cointegration or long-run relationship. Lastly, Vector Autoregressive (VAR) model test was conducted to investigate the causal relationship between the variables studied. Empirical findings from ARDL model shows that there is no short and the long run relationship between unemployment rate, inflation rate and real GDP growth rate in Nigeria. The results of VAR model do not indicate robust evidence and do not confirm an inverse linkage between unemployment rate and economic growth. In view of the foregoing, the study therefore recommends the adoption of fiscal measures that enhance economic growth and private sector activities, hence promoting economic growth and employment generation. In addition, key economic incentives are needed towards attracting foreign direct investment (FDI) in productive sectors of the national economy and expanding resource utilization base.

2021

The phenomenon of jobless growth in Nigeria in recent years has called to question the Okun's law that the growth of gross domestic product (GDP) reduces unemployment. This study therefore, analyses the nexus between GDP growth and unemployment in Nigeria by disaggregating total output into its sectoral components to analyze the impact of sectoral output on unemployment using data from 1980 to-2015 employing the econometric technique of Autoregressive Distributed Lag (ARDL) bound testing approach. Two ARDL models were specified. The first bound test revealed the existence of co integration between unemployment and GDP growth. The growth of GDP is positively related to unemployment in the long run but a negative relationship was found in the short run. The result of the disaggregated model (i.e the second ARDL model) found no long run relationship between unemployment and agriculture, industry, construction, trade, and services. We opined that the findings of the disaggregated model resulted from the disconnection between aggregate demand and aggregate supply of the productive sectors and the lack of direct linkages between the oil sector and other sectors of the economy. The study recommends that such linkages should be forged through enhanced funding of research and development, technological innovation and the development of value chain of agriculture and solid minerals output. Nigerians should be encouraged to consume locally made products. Efforts should be intensified to develop direct linkages between the oil sector and other sectors through input supply contracts and the development of downstream industries in the oil sector.

International Journal of Innovative Finance and Economics Research , 2025

This study examines the impact of unemployment on economic growth in Nigeria from 1990 to 2023. Using econometric techniques, the study analyzes the relationship between unemployment rates, measured as a percentage of the labor force, and real GDP growth. The findings suggest a negative correlation between unemployment and economic growth, aligning with Okun's Law. Higher unemployment rates are associated with lower economic output, potentially due to reduced consumer spending, decreased labor force participation, and diminished investment. The study also considers the impact of other factors such as poverty, inflation, and security on economic growth and unemployment. The results highlight the importance of addressing unemployment as a key strategy for promoting sustainable economic development in Nigeria.

Economic growth is essential for sustainable development. (Olutola, 2013). Under normal circumstances, it is expected that of any economy experiencing growth, which is indicated by an increase in its GDP, a decrease in its unemployment rate should occur. Some studies have been carried out in an attempt to examine the relationship between economic growth and unemployment. These studies have been based on different economies of the world with few on the Nigerian economy. However, and via observation, this relationship is not evident in the Nigerian economy as unemployment has been on the increase despite the economic growth rate increase being experienced. Also, not much research has been given to the estimation of employment elasticity with respect to employment growth in Nigeria (Ogunrinola & Sodipe, 2011). This makes this study very relevant. Hence, this work attempts to add to the body of existing empirical analysis and fill the gap discovered from the literature review with respect to most of the estimation techniques used. This will be done by adopting the Okun’s dynamic model and using the Bounds Cointegration Technique which has not been used in any of the studies reviewed.

Journal of Economics and Sustainable Development, 2014

This study examined the effect of real Gross Domestic Product (GDP) on unemployment in Nigeria. Unemployment is a major problem in Nigeria, even with the recent growth rate of 7% the country is recording, unemployment is still on the increase. The study considers the period 1977 to 2011 to analyse the long run and shot run relationship between real gross domestic product and unemployment in Nigeria, with unemployment as a dependent variable. Besides the main variables for this study, other control variables particularly inflation was included in the model. The study has used Autoregressive Distributed Lag (ARDL) Model to test for ARDLbound co-integration test, the long run and the Error Correction Model (ECM). The co-integration bound test results showed that the variables are co-integrated at 5% level. The results revealed a positive relationship between unemployment and real GDP in Nigeria both in the short run and in the long run. The study concludes that real GDP growth causes unemployment in Nigeria and suggests that Nigeria as a country should reduce the over reliance on petroleum sector as a source of revenue and give more emphasis on other sectors, especially agricultural sector in order to provide more job opportunities to the Nigerian citizens. Also, the government should use the huge revenue it derives from the oil sector to develop other sectors like iron and steel sector, agriculture and so on. The government should also provide environment that will attract capital and investment, the government does not necessary create jobs but does aid the private sector in making job creation possible and imminent.

International Journal

This paper examines the role played by unemployment on the making of the Nigerian Gross Domestic Product (GDP) for a period of nine years (2000-2008). The objectives of the study are to examine the effects of unemployment on the Nigerian GDP for the selected years, to observe the kind of association that existing between the unemployment and the makings of the Nigerian GDP Data was collected and analyzed using the regression analysis. Findings showed that unemployment has an enormous effect (over 65%) on the making of the Nigerian GDP and there exist an inverse relationship between the model (unemployment) and the GDP-increase in the model leads to decrease on the GDP and vice versa Recommendations were proffered based on the study that unemployment can be combated through the Public Sector Reforms. Public Sector Reforms in Nigeria should be taken more serious to drive the human resource development process and to form an effective resource utilization policy. The government should enhance a proper man management system among others

This study investigates the impact of unemployment on economic growth in Nigeria using the OLS multiple regression analytical method in analyzing annual time series secondary data obtained from the Central Bank of Nigeria, statistical abstract from National Bureau of Statistics, as well as the World Development Indicators from the period 1980 – 2016. This study established that unemployment, population and labour force have significant impact on Nigeria's economic growth, while minimum wage does not have a significant impact on the country's economic growth. The underlying principle for such a result is rooted in the Keynesian theory of unemployment which is applicable to the Nigerian economy that is trying to come out from the economic recession. Based on this, the following recommendations were proffered: the government should ensure there is job creation in the economy especially in the real sector; private sector employers should be given subsidies so as to encourage them to employ more people; and the labour market should be deregulated.

2015

Unemployment is a problem of great concern to policy makers of both developing and developed countries as it can yield devastating effect on economic welfare, misery and social instability. Further, unemployment results in some psychological problems of hopelessness, frustration, hostility & gradual drift of some visible unemployed youth into all manner of criminal behaviour. This study thus analyzed the macroeconomic determinants of unemployment in Nigeria using a time series data and an error correction mechanism. The parsimonious result indicates that GDP growth rate, inflation rate, degree of openness, and private domestic investment are statistically significant in influencing unemployment in the short run, particularly during the period under consideration. The Johansen co-integration test supports the existence of a long run relationship among the variables and the negatively signed and significant ECM shows high speed of adjustment from short run fluctuations to long run equ...