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Library / Book / Chapter 5: The Missing Jobs
Chapter 5 of 11

Chapter 5: The Missing Jobs

Chapter 5: The Missing Jobs

The last time Nigeria published a national unemployment survey was the fourth quarter of 2020. Since then, an entire generation has entered the labour market in statistical darkness. On that final survey, the National Bureau of Statistics recorded an unemployment rate of 33.3 percent. Among Nigerians aged 15 to 34, the figure was 53.4 percent. For those with post-secondary education, the rate was 40.1 percent — a devastating indicator that schooling was not translating into work. In urban areas, where graduates congregate, the rate was even higher. Those were the last official numbers. No updated national labour force survey has been published since Q4 2020 — itself a measure of institutional opacity that has persisted for five years.

Statistical Darkness

The subsequent years are not a mystery waiting to be solved. They are a measurement that the state chose not to make. The NBS has released other data — consumer price indices, gross domestic product estimates, trade statistics — but the labour force survey, the instrument that tells a country who is working, who is looking for work, and who has simply given up, fell silent. This silence is not merely a bureaucratic delay. The silence is a policy choice with a specific administrative cause.

Yemi Kale served as Statistician-General of the Federation from 2011 to August 2021. Kale stated publicly in 2018 that the bureau faced insufficient funding and that most government agencies had received only about 10 percent of their capital allocation. The NBS classifies its surveys as capital expenditure, and the Federal Government has consistently failed to release the capital allocations required to conduct them. Kale's tenure ended in August 2021. His successor, Simon Harry, took office and died in April 2022. Semiu Adeyemi Adeniran was appointed Statistician-General in May 2022. A government that does not measure unemployment does not have to answer for it.

The funding mechanism that killed the survey is specific and repeatable. NBS labour force surveys require field staff, transport, tablets, training, and data processing infrastructure. All of these are classified as capital expenditure in the federal budget. In 2018, Kale disclosed that capital releases to most agencies were running at approximately 10 percent of appropriation. The NBS was not exempt. A survey that costs hundreds of millions of naira to conduct cannot be executed on a capital budget that is never released. The budget office knows this. The statistician-general knows this. The silence is structural, not accidental.

The Q4 2020 survey was published in March 2021, at the tail end of the COVID-19 pandemic's first wave. By then, the damage was already severe. The NBS reported that 23.2 million Nigerians were unemployed or underemployed. Youth unemployment had doubled since 2014. The underemployment rate — those working fewer than 20 hours a week or in work far below their skill level — stood at 22.8 percent nationally. These were not figures any administration would welcome.

In April 2021, Chris Ngige, then Minister of Labour and Employment, publicly attacked the methodology of the NBS unemployment data on Twitter. The NBS responded by accusing the minister of distorting facts and lacking confidence in official statistics. The political pressure on the bureau was direct and public. Kale later said he was always ready to be fired for publishing accurate results. Successive governments fixed the optics by ceasing to publish data that measured the problem honestly.

Simon Harry inherited this constraint when he took office in August 2021. He died seven months later, in April 2022, before any structural funding solution could be attempted. Semiu Adeniran, appointed in May 2022, eventually published a new survey in 2023 after a two-year hiatus. The publication was not a return to regular measurement. It was a one-off release that changed the methodology to produce a politically convenient number. The quarterly series that would have tracked labour market trends through the subsidy removal of 2023 and the naira float of 2024 simply does not exist.

The 2020 survey contained other details that should have alarmed policymakers. The unemployment rate among Nigerians with advanced education was higher than among those with only primary schooling — a pattern that inverts the normal relationship between education and employment. In a functioning labour market, more education correlates with better job prospects. In Nigeria, it correlated with frustration. The graduate who spent four years studying computer science and emerged to find no software firm hiring was worse off than the apprentice who learned carpentry and opened a small workshop. The education premium had become an education penalty, and the NBS data proved it.

The survey also revealed stark gender divergences. Female unemployment stood at 35.2 percent nationally, against 31.8 percent for males. Female underemployment was 24.2 percent, against 21.8 percent for males. The disparity was not marginal. It reflected structural constraints — limited access to land, exclusion from credit networks dominated by male guarantors, and the unpaid burden of childcare and household labour that formal employers do not accommodate. An unemployment survey that does not measure informality is bad enough. One that does not measure gendered informality is blind in both eyes, and the NBS 2020 data, for all its limitations, at least documented the blindness before the lights went out entirely.

The survey revealed stark regional divergences as well. The South-South and Southeast recorded unemployment rates above the national average, while the Northwest and Northeast, though lower in strict unemployment, had higher rates of underemployment disguised as agricultural work. The North's lower unemployment rate was not a sign of economic health. It was a sign that northern youth had fewer alternatives to fall back on. They did not become unemployed because they never had the option of formal employment in the first place. The data, in other words, measured not just joblessness but the absence of hope.

The absence is particularly devastating because of what it conceals. Between 2020 and 2025, Nigeria added roughly 20 million people to its population. The United Nations Population Division estimated Nigeria's population at approximately 223 million in 2025, with roughly 60 percent under the age of 25. Each year, approximately 4 to 5 million young Nigerians reach working age. They emerge from universities, polytechnics, technical colleges, and apprenticeships into an economy that has not been measured with sufficient granularity to know whether it absorbs even a fraction of them. The NBS knows how much rice costs. The bureau does not know how many of its young people have work. Adeniran announced in late 2024 that a new Labour Force Survey was planned for 2025. As of April 2026, the survey has not been published. This failure is evidence that the state finds measurement inconvenient.

Proxies exist, but proxies are not substitutes. The NBS Multidimensional Poverty Index, published in 2022 and based on surveys conducted between November 2021 and February 2022, found that 63 percent of Nigerians — 133 million people — were multidimensionally poor. The World Bank Nigeria Development Update, April 2026, projected that poverty had risen to 63 percent by 2025, encompassing approximately 140 million people. Poverty and unemployment are not the same variable, but they move together. A country where two in three citizens are poor is not a country where jobs are abundant. The absence of labour force data simply spares policymakers the embarrassment of confirming what the poverty figures already imply.

The Central Bank of Nigeria, under Governor Yemi Cardoso, has focused on monetary stabilisation — exchange rate management, inflation targeting, and foreign exchange market reforms. These are legitimate priorities. Monetary policy cannot create jobs. It can only create the conditions under which job creation might occur. Without labour market data, even that modest claim cannot be tested. The CBN tightens interest rates to control inflation. It does not know how many borrowers are small businesses that employ five people. It floats the naira to attract investment. It does not know how many exporters exist outside the oil sector, or how many people they employ. The policy apparatus is flying blind, and the altimeter was deliberately unplugged by a budget process that classifies statistical measurement as capital spending and then releases less than 8 percent of the capital budget.

Without labour force data, the budget process cannot target employment programmes. The Ministry of Finance allocates funds to agriculture, to industry, to social investment, but it cannot say how many people each sector employs or whether the allocation changes that number. The Ministry of Budget and National Planning produces medium-term expenditure frameworks that project growth and revenue, but the employment elasticities in those frameworks are guesses. The planners guess because the NBS stopped measuring. The silence is not an absence of information. That silence is an absence of accountability dressed as a data gap.

53.4 percent of Nigerians aged 15 to 34 were unemployed in Q4 2020 — the last time the National Bureau of Statistics measured youth joblessness. An estimated 20 to 25 million new labour market entrants have since reached working age without a single national survey to record what they found.

National Bureau of Statistics, Nigeria Labour Force Survey Q4 2020, March 2021; United Nations Population Division, 2025 estimates

The Definitional Gap

Into this void step the modelled estimates. The International Labour Organisation publishes unemployment figures for Nigeria through its ILOSTAT database. In recent years, these estimates have ranged from approximately 3 to 5 percent. At first glance, this seems to describe a different country entirely — an economy with modest frictional unemployment rather than a crisis of mass joblessness. The discrepancy is not an error. The gap is a methodological divergence that reveals more about the poverty of Nigerian statistics than about the health of its labour market.

The ILO applies a narrow definition: the unemployed are those who are without work, currently available for work, and actively seeking work. In Nigeria, this definition captures almost no one. A young graduate who spends six months searching for a formal position and then starts selling phone accessories from a cart is not unemployed by ILO standards. She is employed — informally, precariously, and without social protection, but employed. A former factory worker who loses his job and returns to his village to farm family land is not unemployed. He is engaged in subsistence agriculture. The ILO model, applied to a labour market where formal jobs are scarce and survival strategies are universal, produces an unemployment rate that would be the envy of Germany. The model is statistically correct and analytically useless for policymaking in a country where one hour of work per week counts as employment.

The divergence matters because these modelled estimates are what international investors, development agencies, and policymakers consume. A portfolio manager in London looking at Nigeria sees a 4 percent unemployment rate and concludes that labour is tight, wages are rising, and the consumer class is expanding. He does not see the graduate driving a commercial tricycle because there is no office job. A bilateral aid agency sees low unemployment and redirects funding from employment programmes to financial sector reform. The models do not lie, but they answer the wrong question. They ask how many people are without work and seeking it. They do not ask how many people are with work that cannot sustain them.

The ILO models also miss the phenomenon of discouraged workers — those who have stopped looking because looking is futile. In the NBS 2020 survey, this group was substantial and growing. A graduate who has sent 200 job applications without a single interview eventually stops sending. A mother who cannot afford transport to job centres stops going. By ILO definition, they are not unemployed. They are outside the labour force, as if their absence were voluntary rather than forced. The models treat despair as choice.

Yemi Kale understood this. He resisted adopting the ILO one-hour methodology for ten years because, as he explained on Arise TV in August 2023, the income generated from one hour's work in Nigeria cannot sustain a worker. The 20-hour threshold used in the 2020 survey was chosen because a committee that included ILO representatives agreed it was the minimum that might generate enough income to equate to one hour of wages in the United States. Kale's successor abandoned that threshold. In August 2023, the NBS under Adeniran published a new unemployment figure of 4.1 percent for Q1 2023, using the one-hour ILO standard. The political utility of that figure was unmistakable. The analytical utility was zero.

The NBS 2020 survey used a broader definition, closer to the reality of underemployment and discouraged work-seeking that characterises Nigerian labour markets. Its 33.3 percent figure included those working fewer hours than they wished, those whose skills were mismatched to their work, and those who had abandoned the search. When the NBS stopped publishing regular quarterly surveys, the ILO models continued, generating numbers that bear no resemblance to lived experience. The lesson is not that the ILO is wrong. The lesson is that without primary data collection, models become fiction dressed in decimal points. Nigeria has chosen fiction, and the choice was made in the budget office as much as in the statistical bureau.

The definitional gap is not merely academic. It determines who receives development assistance, how investors price risk, and what policies governments adopt. When the NBS published 4.1 percent unemployment in August 2023, using the one-hour ILO standard, the figure was immediately useful to a government that wanted to claim progress. But it was useless to a policymaker trying to design a jobs programme. If a graduate who works two hours per week selling recharge cards is counted as employed, then no jobs programme is necessary. The data says the problem is solved. The reality says the problem has been redefined by statistical sleight of hand. Kale's 20-hour standard was not perfect, but it at least attempted to measure whether a worker earned enough to survive. The one-hour standard measures whether a worker is breathing.

The ILO itself does not mandate the one-hour standard as an exclusive measure. Its guidelines allow countries to adopt supplementary measures that reflect local labour market conditions. Nigeria chose to abandon its supplementary measure — the 20-hour threshold that Kale's committee had designed with ILO participation — and adopt only the narrowest international definition. The result is a statistical system that tells policymakers what they want to hear and tells citizens nothing about their actual economic condition. The NBS has not published a quarterly labour force survey since that 2023 release. The promise of regular measurement remains unfulfilled. The definitional gap has become a permanent feature of Nigerian economic governance.

The consequences of this definitional confusion fall heaviest on young Nigerians. A 25-year-old graduate who sells phone accessories for twelve hours a day is counted as employed by the ILO and as underemployed by the NBS 2020 methodology. Both definitions are methodologically defensible. Only one describes her lived reality. The policy that treats her as employed will not design a jobs programme for her. The policy that treats her as underemployed might, but that policy requires data that the state no longer collects. She is caught between two statistical regimes, and neither regime serves her.

The State as Job Destroyer

The demography is unforgiving. With approximately 4 to 5 million new entrants to the labour market each year, the economy must create that many jobs simply to keep the unemployment rate stable. It does not. No Nigerian administration has presided over net job creation at that scale. The World Bank's April 2026 Nigeria Development Update noted that growth in services and industry has lagged agriculture, constraining poverty reduction. What the report described politely is that the sectors capable of absorbing mass labour — manufacturing, construction, formal services — are either stagnant or contracting relative to the population. The state has failed to create jobs. In some cases, it has actively destroyed the jobs that existed.

On 18 May 2022, Governor Babajide Sanwo-Olu of Lagos State announced a total ban on commercial motorcycle operations, widely known as okada, across six local government areas of the state. The ban took effect on 1 June 2022. The affected areas — Ikeja, Surulere, Eti-Osa, Lagos Island, Lagos Mainland, and Apapa — represent the commercial core of Nigeria's largest city. The governor acted under the Lagos State Transport Sector Reform Law of 2018, citing road safety and violent crime. The immediate trigger was the lynching of a sound engineer, David Imoh, by okada riders in Lekki following a dispute over ₦100 change. The policy response was not regulation, licensing, or phased transition. It was eradication.

The job destruction was immediate and quantifiable. Various estimates place the number of okada riders operating in Lagos at between 200,000 and 400,000. The International Centre for Investigative Reporting noted that an estimated 400,000 okada ply Lagos roads daily. Gokada, a bike-hailing startup, laid off approximately 7,000 riders following earlier restrictions. The six-LGA ban of June 2022 displaced tens of thousands of informal transport workers in a single week. Bolt, Uber, and independent operators combined saw their driver networks collapse in the affected zones. The state created an anti-okada enforcement squad of 600 personnel to ensure compliance. Motorcycles were seized and crushed. Riders who had invested their savings in purchasing bikes lost their capital and their livelihoods simultaneously.

This is job destruction by policy, which is analytically distinct from job creation failure. The okada ban did not fail to create employment. It removed employment that already existed. The riders were not stealing. They were filling a mobility gap that the state's bus system could not fill. Lagos Metropolitan Area Transport Authority data showed that commercial buses and taxis were inadequate to satisfy commuting demand. The okada riders provided last-mile transport in traffic-choked corridors. When they were removed, commuters walked. The state offered no scalable alternative — a few hundred LAGFERRY boats could not replace hundreds of thousands of motorcycle trips. The policy destroyed livelihoods without replacing them. For a chapter about missing jobs, the Lagos okada ban is the most concrete, named, dated example of the state making jobs disappear.

The enforcement was relentless and theatrical. Lagos State deployed 600 personnel across police, Nigeria Security and Civil Defence Corps, Lagos Safety Neighbourhood Corps, and Federal Road Safety Corps to enforce the ban. Motorcycles were seized and crushed before the public. By September 2022, the ban had expanded to additional local government areas including Kosofe, Mushin, Oshodi, and Shomolu. The state claimed 85 percent compliance within three days of each expansion. What it did not publish was the employment ledger: how many riders lost income, how many families lost their sole breadwinner, how many investors in motorcycle fleets lost their capital. The Lagos State government later inaugurated 500 buses to replace the okada, but 500 buses cannot replace 200,000 motorcycles. The arithmetic of substitution was never credible. The policy was designed to remove a visible nuisance, not to protect a livelihood.

The okada ban also illustrates a gendered dimension of policy-driven job loss. While the majority of okada riders are male, the informal transport ecosystem they supported employed women as dispatch riders, delivery agents, and market suppliers. When the bikes disappeared, the supply chains that moved goods from Lagos Island markets to mainland retailers seized up. The bread seller who relied on okada to deliver her stock had no delivery vehicle. The seamstress who sent finished clothes to customers by motorcycle courier lost her logistics network. Job destruction by policy cascades through the informal economy in ways that aggregate statistics never capture. The NBS does not survey this cascade. The ILO models cannot detect it.

Ninety Percent Informal

Where the formal sector fails, the informal sector absorbs. The International Labour Organisation, in its 2022 Nigeria country brief, estimated that 83.7 percent of non-agricultural employment in Nigeria is informal. ILO estimates range from 83.7 percent of non-agricultural employment to 92.3 percent of total employment when agricultural labour is included. The rate is even higher among women: the ILO estimated 96.0 percent of working women were in informal jobs in 2022, while the NBS 2020 survey found 77 percent of women in employment worked in the informal sector — the divergence reflecting different survey instruments and definitions. Among young people, informal employment surpasses the national average at 98 percent. For young women, the rate is nearly universal: 99.1 percent. These figures describe not a marginal survival strategy but the dominant mode of economic existence for the vast majority of Nigerians.

The NBS 2020 Labour Force Survey confirmed this pattern. Of the 46.5 million Nigerians recorded as employed in Q4 2020, 30.6 million worked 40 or more hours per week — what the survey classified as full-time. But full-time in Nigeria does not mean formal. It means persistent. The Small and Medium Enterprises Development Agency of Nigeria and the NBS, in their 2021 National MSME Collaborative Survey, confirmed that micro, small, and medium enterprises account for 96 percent of businesses, approximately 84 percent of employment, and 48 percent of GDP. These are 2021 survey figures, not the undated claims that have circulated for years. They are directionally consistent with older estimates but carry the authority of recent fieldwork.

The scale of the invisible economy is staggering, though exact measurement remains disputed. The NBS, in its 2016 formal and informal sector split of gross domestic product, found that the informal sector contributed approximately 50 percent of nominal GDP. The Moniepoint 2024 Informal Economy Report, derived from data on over two million businesses, estimated the informal economy at 58 percent of GDP. The World Economics Quarterly Informal Economy Survey places Nigeria's informal economy at 55 to 57 percent of GDP. The SMEDAN/NBS 2017 National Survey of Micro, Small and Medium Enterprises found that Nigeria had approximately 41.5 million MSMEs, with micro-enterprises accounting for 99.8 percent of the total. These enterprises contributed 49.78 percent of GDP and 76.5 percent of national employment. The range across sources — 50 to 65 percent of GDP — is wide, but the directional conclusion is robust. More than half of Nigeria's economic output occurs outside the tax net, the regulatory framework, and the statistical measurement system.

The Moniepoint 2024 report added granularity that official statistics lack. Of the informal businesses surveyed, 72.3 percent reported monthly revenues above ₦1 million. But 90 percent made less than ₦500,000 in monthly profit. Only 1.3 percent earned above ₦2.5 million monthly. The typical informal operator is young — 58 percent are under 34 — and entered informal work because of unemployment. Eighty-nine percent pay some form of tax, but these are market levies and local government charges, not corporate income tax. Eight in ten businesses have operated for less than five years. The informal economy is not a stable foundation. Informal work is a high-turnover, low-margin treadmill on which millions run without advancing.

What constitutes this invisible economy? The categories are specific and observable. Petty trading — market stalls, street hawking, sachet water sales in traffic — employs millions of women and youth. Artisanal work — carpentry, tailoring, phone repair, hairdressing — operates in rooms without electricity, using tools bought on credit. Domestic labour — cleaning, cooking, childcare — is performed overwhelmingly by women without contracts, minimum wages, or social protection. Subsistence farming — smallholders farming less than two hectares without irrigation, mechanism, or reliable market access — absorbs roughly a third of the labour force by some estimates. The NBS 2020 survey found that agriculture remained the largest employer, but agricultural employment in Nigeria is largely subsistence. Subsistence farming is not a destination. The farm is a last resort.

The link between education and informality is not accidental. The National Information Technology Development Agency reported that 85 percent of Nigerian graduates have no digital skills and cannot use basic office software. A study by Pitan Oluyomi and Adedeji S.O. of the University of Ibadan found a 60.6 percent skills mismatch among recent graduates. The universities graduate hundreds of thousands of students annually, but laboratories lack equipment, libraries lack current texts, and lecturers strike for months at a time. The graduate who has spent six years in a four-year programme because of strikes, who has never operated industry-standard software, and who has learned accounting theory without touching Sage or SAP, is not equipped for the labour market. She is equipped for the informal sector.

The gender dimension of informality compounds the injustice. Women are disproportionately represented in petty trading, food processing, and domestic services. They face additional constraints: limited access to land, exclusion from credit networks dominated by male guarantors, and the unpaid burden of childcare and household labour that formal employers do not accommodate. The ILO found that 90.5 percent of working women are in self-employment, compared to 84.2 percent of men. Self-employment in this context does not mean entrepreneurship. It means survival without an employer. Women in the informal sector work longer hours than men but earn less, a pattern documented across every region of Nigeria in the 2020 survey.

The NBS 2020 survey disaggregated unemployment by gender with precision that subsequent silence has erased. Female unemployment stood at 35.2 percent nationally against 31.8 percent for males. Female underemployment was 24.2 percent against 21.8 percent for males. In the 15-to-24 age bracket, the combined unemployment and underemployment rate for females reached 73.2 percent. These women are not uniformly distributed across the informal economy. They cluster in the lowest-margin activities: food processing, petty trading, and domestic labour. The woman who fries akara by the roadside works longer hours than the male okada rider she feeds, but her daily profit is a fraction of his earnings. She cannot scale her business because she has no collateral for credit. She cannot hire help because her margin does not permit it. She cannot formalise because the cost of registration exceeds her monthly revenue. The gender data from the 2020 survey is the last official measurement of this gap. No subsequent survey has updated it.

The informal worker pays no income tax, but she also receives no pension, no health insurance, no maternity leave, and no protection against arbitrary dismissal. The National Health Insurance Authority covers only 10 to 15 percent of Nigerians in formal schemes. She is outside the law not because she is lawless, but because the law has never bothered to reach her. The state does not regulate her hours, inspect her workplace, or guarantee her wages. In exchange, the state does not provide her with electricity, credit, or security. This is not a social contract. The arrangement is the absence of one. And now the state wants to tax her.

The policy response to informality has followed a predictable orthodoxy: formalise, register, regulate, and tax. The logic is seductive. If 90 percent or more of employment is informal, bringing even a fraction into the tax net would dramatically broaden the revenue base. The tax reform law signed in June 2025 and effective January 2026 aims to raise Nigeria's tax-to-GDP ratio from its current low base toward 18 percent. The Federal Inland Revenue Service collected a record ₦21.6 trillion in 2024, a 76 percent increase from 2023. The state is getting better at collecting money. The question is whether it has earned the right to collect it from those who receive nothing in return.

Consider what formalisation demands of a street vendor in Ibadan. She must register her business, keep accounts, file returns, and remit taxes. In exchange, the state offers her what, exactly? Electricity? The national grid collapses with such regularity that the Presidency spent ₦10 billion to take Aso Rock Villa off it. Credit? The Bank of Industry publishes annual reports on SME lending, but the vast majority of informal operators have no collateral, no credit history, and no relationship with a formal financial institution. Security? In many parts of Nigeria, the state cannot protect its own police stations. Contract enforcement? The judicial system is congested, slow, and expensive. The informal sector has not opted out of the state. The state has failed to provide the public goods that would make formal participation rational.

Local government authorities in states such as Lagos, Kano, and Anambra compound the problem. In many states, local councils impose levies on informal operators — market fees, hawking permits, environmental charges — that bear no relationship to service delivery. These are not taxes in the fiscal sense. They are extortion, collected by officials who provide nothing in return and punish non-compliance with confiscation or violence. The informal operator who pays these levies does not become formal. She simply becomes poorer. The state that cannot meter electricity has no moral standing to meter her cart.

The Enhancing Financial Innovation and Access organisation publishes annual surveys on access to financial services in Nigeria. These surveys consistently find that informal operators remain outside the formal banking system not because they are ignorant of its benefits, but because the system is not designed for them. A market woman who deposits her daily earnings in a savings group with her peers is not financially illiterate. She is financially rational. The formal bank requires a minimum balance she cannot maintain, documentation she does not have, and branches she cannot reach. Her informal savings group charges no fees, requires no paperwork, and meets under the same tree where she sells her goods. The state that wants to tax her has not built a bank that can serve her.

Some labour economists, including researchers at the Nigerian Economic Summit Group, have argued that the informal sector is not a problem to be solved but a resilient adaptation to state failure. Attempts to force formalisation — through taxation, regulation, or harassment by local government authorities — without delivering services in return may destroy livelihoods without creating replacements. A tax collector who shuts down an unregistered shop but cannot provide the conditions for a registered shop to survive is not expanding the economy. He is shrinking it. The carpenter who builds furniture without a workshop, the tailor who sews without reliable light, the trader who moves goods across states on roads that wreck her vehicle — these are not parasites. They are entrepreneurs operating under conditions that would bankrupt a formal business. They are, in a sense, the most efficient sector of the Nigerian economy, because they survive despite the state rather than because of it.

The Exit Route

Those who cannot find adequate work in Nigeria do not always stay. The emigration of skilled and unskilled labour — known colloquially as japa — has accelerated into a measurable exodus. Canada has become the primary destination. In 2022, Nigeria was the number one source country for new permanent residents in Canada, with 26,590 Nigerian-born individuals admitted — Immigration, Refugees and Citizenship Canada, Annual Report 2023. The United Kingdom has also seen a surge. Australia, the United States, and the United Arab Emirates have all recorded sharp increases in Nigerian visa applications since 2020. The japa wave is not a rumour. The exodus is a documented population transfer.

The General Medical Council of the United Kingdom registered 2,240 Nigerian-trained doctors with primary qualifications from Nigeria as of 2022. In a single year, 2021 to 2022, 1,807 Nigerian doctors were added to the UK register. The Medical and Dental Council of Nigeria issued approximately 12,000 to 15,000 verifications and attestations to Nigerian doctors seeking foreign registration between 2018 and 2022. Nigeria has approximately 35,000 registered doctors for a population of roughly 220 million. The doctor-to-population ratio is approximately 0.4 per 10,000, against the World Health Organisation minimum of 1 per 1,000. The health system is bleeding out through emigration.

The nursing exodus matches the medical brain drain. The Nigeria Nurses Association estimated that more than 15,000 nurses left Nigeria for the United Kingdom, Canada, and Australia between 2020 and 2024. The United States hosts approximately 3,000 Nigerian-trained doctors. These are not unskilled migrants fleeing poverty. They are skilled professionals fleeing a labour market that cannot absorb or reward their training. The cost of their education was borne by Nigerian taxpayers — federal universities, teaching hospitals, and licensure examinations. The benefit of their labour is captured by the National Health Service in London and the provincial health systems of Ontario and Alberta.

The cost of this brain drain is not merely the loss of skilled workers. The loss includes the public investment in their training. A doctor who graduates from the University of Lagos College of Medicine has been educated with federal and state funds — subsidised tuition, teaching hospital rotations, and licensure examinations underwritten by taxpayer money. When that doctor relocates to Manchester or Toronto, the investment stays in Nigeria but the returns accrue to the NHS or the provincial health plan. The Nigerian taxpayer has funded the training of a worker whose taxes will now build British roads and Canadian schools. This is not migration. That movement is a capital flight of human capital that no balance of payments statement records.

Another layer of survival is diaspora remittances. The Central Bank of Nigeria estimates that Nigerians abroad send home approximately $20.9 billion annually. These flows do not create jobs directly, but they sustain households that would otherwise collapse. A family in Anambra State whose son works in Houston can afford school fees, medical bills, and petty trading capital. A family without such a lifeline has none of these. The informal economy is thus subsidised by the global dispersal of Nigerian labour — the export of workers whose remittances keep those who remain alive. Remittance dependence is a labour market strategy, but not a development strategy. The country that exports its doctors and nurses to fill labour shortages in wealthier nations is not solving its unemployment problem. Nigeria is exporting its unemployment problem.

The japa phenomenon has a gendered dimension that is less visible but equally significant. Female nurses dominate the emigration statistics. Female engineers and accountants are also leaving in growing numbers. The women who remain in Nigeria's informal sector face a labour market that has lost its most skilled female professionals to foreign health systems and corporate offices. The exit route is not available to everyone. It requires a passport, a visa, and often an air ticket that costs more than a year's informal earnings. The nurse who can verify her credentials with the UK Nursing and Midwifery Council has an exit route. The market trader in Kano does not. The exit route is a selective pressure valve, and its selectivity deepens the gender gap in domestic economic opportunity.

Remittances of $20.9 billion annually are the second-largest foreign exchange inflow after oil revenue, according to the Central Bank of Nigeria. But remittances are a private transfer, not a public investment. They do not build roads, fund power plants, or train teachers. They sustain individual households at a level that masks systemic failure. A family receiving $500 per month from a son in Canada can afford private school fees, generator fuel, and medical bills at a private clinic. The family next door without a diaspora connection has none of these options. Remittances thus create a two-tier welfare state: one funded by foreign salaries, the other left to the collapsing public system. The japa economy is not a solution to unemployment. Remittance dependence is a privatised coping mechanism that deepens inequality between families with foreign connections and those without.

Counting What Cannot Be Counted

In the absence of official labour market data, proxies emerge. They do not replace a proper survey, but they illuminate corners that the NBS no longer visits. Moniepoint, a financial technology company, reported over 2 million merchants on its platform as of 2024. These are micro-businesses — market stalls, neighbourhood shops, roadside vendors — that process digital payments through point-of-sale terminals. Their transaction volume is a proxy for informal economic activity. When Moniepoint processes approximately ₦2 trillion in transactions per month, it is measuring a layer of commerce that the NBS statistical framework barely recognises.

The gig economy produces its own shadows. Bolt and Uber operate in Lagos, Abuja, and Port Harcourt, but neither publishes Nigeria-specific driver counts. The available estimates suggest 600,000 to 700,000 registered drivers across platforms in major cities. PalmPay and OPay claim over 1.5 million registered agents processing transactions through informal networks. These agents are not employees. They are independent operators who earn commissions on cash-in and cash-out services. Their work is invisible to the NBS, but it is visible in the transaction logs of the fintech platforms that employ them.

The point-of-sale agent network is perhaps the most significant unmeasured labour force in Nigeria today. Following the Central Bank of Nigeria's cashless policy and the chaotic currency redesign of early 2023, digital payment adoption doubled among informal businesses. Moniepoint data shows that card payments became the most common transaction method for informal merchants, exceeding cash in some categories. Each POS terminal represents an independent agent who has purchased or leased the device, paid for data connectivity, and built a customer base. These agents are employers of sorts — many hire assistants to manage peak hours. They are also creditors, extending informal credit to trusted customers. The NBS has no category for POS agent. The labour force survey that might have counted them has not been conducted since 2020. Yet their number — likely in the millions — represents one of the few growth areas in Nigerian employment, a growth that occurred not because of policy design but because of policy chaos.

Other proxies fill the measurement void in different ways. The Jobberman Foundation reported in 2025 that six out of ten Nigerian graduates lack the necessary skills for available jobs. Stutern estimated in 2022 that only 10 percent of Nigerian employers view graduates as job-ready. These are not labour force surveys, but they measure the same mismatch from the demand side. When employers consistently report that graduates cannot perform the tasks for which they were trained, the labour market is sending a signal that the NBS no longer records. The signal is that Nigeria's education system produces inputs for an economy that does not exist.

Andela provides a different kind of proxy. The company, founded in 2014, originally ran a four-year residential training programme for African software developers, placing them with global technology firms. Between 2020 and 2021, Andela pivoted from residential training to a "talent cloud" model — connecting African engineers to global remote opportunities on a contract basis. The shift was commercially rational. It was also an admission that the Nigerian formal employment market could not absorb the engineers Andela trained. By 2023, Andela's talent network exceeded 175,000 engineers. These are Nigerians earning dollar salaries while physically resident in Lagos. They are employed, but not by Nigeria. Their employment is a bypass of the domestic labour market, not a product of its health. The specific companies, their valuations, and their structural significance are documented in Chapter 9.

The technology sector demonstrates that high-quality employment is possible for a fraction of the labour force — a fraction that is real, remarkable, and orders of magnitude below what a labour market absorbing four million annual entrants requires. Paystack, acquired by Stripe for $200 million in 2020, and Flutterwave, valued at $3 billion in 2022, are genuine success stories. They are also statistically irrelevant to the labour market as a whole. The total employment generated by Nigeria's technology ecosystem is measured in the tens of thousands. Technology employment is not measured in millions. The sector is highly skill-intensive, requiring levels of education, internet access, and technical training that exclude the vast majority of labour market entrants. The ecosystem is concentrated in Lagos and a handful of other urban centres. The technology sector shows that the Nigerian economy can create high-quality employment for a tiny elite, but it cannot create mass employment at any quality level.

The tragedy is that the informal sector contains genuine productive capacity that the state neither serves nor understands. The carpenter who builds furniture without a workshop, the tailor who sews without reliable light, the trader who moves goods across states on roads that wreck her vehicle — these are not parasites. They are entrepreneurs operating under conditions that would bankrupt a formal business. Their productivity is invisible in GDP calculations, uncounted in employment surveys, and ignored in policy design. They are the missing jobs — not missing because they do not exist, but missing because the state has never bothered to see them. And now the state wants to tax them.

In FY2025, the Federal Government appropriated ₦18.53 trillion and released ₦834.8 billion against that appropriation by July 2025 — a capital budget execution rate of 7.72%. The workers who could not find formal jobs were not imagining the country's infrastructure decay. They were living inside it. The arithmetic of what was budgeted, what was released, and what was built — and who profited from the gap — is the subject of Chapter 6.

Sources

  1. National Bureau of Statistics (NBS). Nigeria Labour Force Statistics: Unemployment and Underemployment Report Q4 2020. March 2021. nigerianstat.gov.ng
  2. International Labour Organisation (ILO). Nigeria Policy Brief: Informal Employment and Working Poverty. November 2024. ilo.org
  3. United Nations Population Division. World Population Prospects 2024. 2025 estimates.
  4. World Bank. Nigeria Development Update: Nigeria's Tomorrow Must Start Today. April 2026.
  5. Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and National Bureau of Statistics (NBS). National MSME Collaborative Survey 2021. smedan.gov.ng
  6. Moniepoint. 2024 Nigerian Informal Economy Report. July 2024. moniepoint.com
  7. Immigration, Refugees and Citizenship Canada (IRCC). Annual Report to Parliament on Immigration 2023. canada.ca
  8. General Medical Council (UK). State of Medical Education and Practice in the UK 2022. gmc-uk.org
  9. Central Bank of Nigeria (CBN). Diaspora remittance estimates and balance of payments data. 2023.
  10. National Information Technology Development Agency (NITDA). Digital skills assessment report. 2024. nitda.gov.ng
  11. Pitan Oluyomi S. and Adedeji S.O. "Skills Mismatch Among University Graduates in the Nigeria Labour Market." International Journal of Business and Social Science. 2012.
  12. Jobberman Foundation. Nigeria Graduate Skills Gap Report 2025. jobberman.com
  13. International Centre for Investigative Reporting (ICIR). "Commuters groan as Lagos govt enforces ban on okada operations." June 2022. icirnigeria.org
  14. Debt Management Office (DMO). Quarterly Debt Report Q4 2025. February 2026. dmo.gov.ng
  15. Budget Office of the Federation. 2025 Budget Implementation Report (January–July). 2025. budgetoffice.gov.ng
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Chapter 5 of 11

Chapter 5: The Missing Jobs

Chapter 5: The Missing Jobs

The last time Nigeria published a national unemployment survey was the fourth quarter of 2020. Since then, an entire generation has entered the labour market in statistical darkness. On that final survey, the National Bureau of Statistics recorded an unemployment rate of 33.3 percent. Among Nigerians aged 15 to 34, the figure was 53.4 percent. For those with post-secondary education, the rate was 40.1 percent — a devastating indicator that schooling was not translating into work. In urban areas, where graduates congregate, the rate was even higher. Those were the last official numbers. No updated national labour force survey has been published since Q4 2020 — itself a measure of institutional opacity that has persisted for five years.

Statistical Darkness

The subsequent years are not a mystery waiting to be solved. They are a measurement that the state chose not to make. The NBS has released other data — consumer price indices, gross domestic product estimates, trade statistics — but the labour force survey, the instrument that tells a country who is working, who is looking for work, and who has simply given up, fell silent. This silence is not merely a bureaucratic delay. The silence is a policy choice with a specific administrative cause.

Yemi Kale served as Statistician-General of the Federation from 2011 to August 2021. Kale stated publicly in 2018 that the bureau faced insufficient funding and that most government agencies had received only about 10 percent of their capital allocation. The NBS classifies its surveys as capital expenditure, and the Federal Government has consistently failed to release the capital allocations required to conduct them. Kale's tenure ended in August 2021. His successor, Simon Harry, took office and died in April 2022. Semiu Adeyemi Adeniran was appointed Statistician-General in May 2022. A government that does not measure unemployment does not have to answer for it.

The funding mechanism that killed the survey is specific and repeatable. NBS labour force surveys require field staff, transport, tablets, training, and data processing infrastructure. All of these are classified as capital expenditure in the federal budget. In 2018, Kale disclosed that capital releases to most agencies were running at approximately 10 percent of appropriation. The NBS was not exempt. A survey that costs hundreds of millions of naira to conduct cannot be executed on a capital budget that is never released. The budget office knows this. The statistician-general knows this. The silence is structural, not accidental.

The Q4 2020 survey was published in March 2021, at the tail end of the COVID-19 pandemic's first wave. By then, the damage was already severe. The NBS reported that 23.2 million Nigerians were unemployed or underemployed. Youth unemployment had doubled since 2014. The underemployment rate — those working fewer than 20 hours a week or in work far below their skill level — stood at 22.8 percent nationally. These were not figures any administration would welcome.

In April 2021, Chris Ngige, then Minister of Labour and Employment, publicly attacked the methodology of the NBS unemployment data on Twitter. The NBS responded by accusing the minister of distorting facts and lacking confidence in official statistics. The political pressure on the bureau was direct and public. Kale later said he was always ready to be fired for publishing accurate results. Successive governments fixed the optics by ceasing to publish data that measured the problem honestly.

Simon Harry inherited this constraint when he took office in August 2021. He died seven months later, in April 2022, before any structural funding solution could be attempted. Semiu Adeniran, appointed in May 2022, eventually published a new survey in 2023 after a two-year hiatus. The publication was not a return to regular measurement. It was a one-off release that changed the methodology to produce a politically convenient number. The quarterly series that would have tracked labour market trends through the subsidy removal of 2023 and the naira float of 2024 simply does not exist.

The 2020 survey contained other details that should have alarmed policymakers. The unemployment rate among Nigerians with advanced education was higher than among those with only primary schooling — a pattern that inverts the normal relationship between education and employment. In a functioning labour market, more education correlates with better job prospects. In Nigeria, it correlated with frustration. The graduate who spent four years studying computer science and emerged to find no software firm hiring was worse off than the apprentice who learned carpentry and opened a small workshop. The education premium had become an education penalty, and the NBS data proved it.

The survey also revealed stark gender divergences. Female unemployment stood at 35.2 percent nationally, against 31.8 percent for males. Female underemployment was 24.2 percent, against 21.8 percent for males. The disparity was not marginal. It reflected structural constraints — limited access to land, exclusion from credit networks dominated by male guarantors, and the unpaid burden of childcare and household labour that formal employers do not accommodate. An unemployment survey that does not measure informality is bad enough. One that does not measure gendered informality is blind in both eyes, and the NBS 2020 data, for all its limitations, at least documented the blindness before the lights went out entirely.

The survey revealed stark regional divergences as well. The South-South and Southeast recorded unemployment rates above the national average, while the Northwest and Northeast, though lower in strict unemployment, had higher rates of underemployment disguised as agricultural work. The North's lower unemployment rate was not a sign of economic health. It was a sign that northern youth had fewer alternatives to fall back on. They did not become unemployed because they never had the option of formal employment in the first place. The data, in other words, measured not just joblessness but the absence of hope.

The absence is particularly devastating because of what it conceals. Between 2020 and 2025, Nigeria added roughly 20 million people to its population. The United Nations Population Division estimated Nigeria's population at approximately 223 million in 2025, with roughly 60 percent under the age of 25. Each year, approximately 4 to 5 million young Nigerians reach working age. They emerge from universities, polytechnics, technical colleges, and apprenticeships into an economy that has not been measured with sufficient granularity to know whether it absorbs even a fraction of them. The NBS knows how much rice costs. The bureau does not know how many of its young people have work. Adeniran announced in late 2024 that a new Labour Force Survey was planned for 2025. As of April 2026, the survey has not been published. This failure is evidence that the state finds measurement inconvenient.

Proxies exist, but proxies are not substitutes. The NBS Multidimensional Poverty Index, published in 2022 and based on surveys conducted between November 2021 and February 2022, found that 63 percent of Nigerians — 133 million people — were multidimensionally poor. The World Bank Nigeria Development Update, April 2026, projected that poverty had risen to 63 percent by 2025, encompassing approximately 140 million people. Poverty and unemployment are not the same variable, but they move together. A country where two in three citizens are poor is not a country where jobs are abundant. The absence of labour force data simply spares policymakers the embarrassment of confirming what the poverty figures already imply.

The Central Bank of Nigeria, under Governor Yemi Cardoso, has focused on monetary stabilisation — exchange rate management, inflation targeting, and foreign exchange market reforms. These are legitimate priorities. Monetary policy cannot create jobs. It can only create the conditions under which job creation might occur. Without labour market data, even that modest claim cannot be tested. The CBN tightens interest rates to control inflation. It does not know how many borrowers are small businesses that employ five people. It floats the naira to attract investment. It does not know how many exporters exist outside the oil sector, or how many people they employ. The policy apparatus is flying blind, and the altimeter was deliberately unplugged by a budget process that classifies statistical measurement as capital spending and then releases less than 8 percent of the capital budget.

Without labour force data, the budget process cannot target employment programmes. The Ministry of Finance allocates funds to agriculture, to industry, to social investment, but it cannot say how many people each sector employs or whether the allocation changes that number. The Ministry of Budget and National Planning produces medium-term expenditure frameworks that project growth and revenue, but the employment elasticities in those frameworks are guesses. The planners guess because the NBS stopped measuring. The silence is not an absence of information. That silence is an absence of accountability dressed as a data gap.

53.4 percent of Nigerians aged 15 to 34 were unemployed in Q4 2020 — the last time the National Bureau of Statistics measured youth joblessness. An estimated 20 to 25 million new labour market entrants have since reached working age without a single national survey to record what they found.

National Bureau of Statistics, Nigeria Labour Force Survey Q4 2020, March 2021; United Nations Population Division, 2025 estimates

The Definitional Gap

Into this void step the modelled estimates. The International Labour Organisation publishes unemployment figures for Nigeria through its ILOSTAT database. In recent years, these estimates have ranged from approximately 3 to 5 percent. At first glance, this seems to describe a different country entirely — an economy with modest frictional unemployment rather than a crisis of mass joblessness. The discrepancy is not an error. The gap is a methodological divergence that reveals more about the poverty of Nigerian statistics than about the health of its labour market.

The ILO applies a narrow definition: the unemployed are those who are without work, currently available for work, and actively seeking work. In Nigeria, this definition captures almost no one. A young graduate who spends six months searching for a formal position and then starts selling phone accessories from a cart is not unemployed by ILO standards. She is employed — informally, precariously, and without social protection, but employed. A former factory worker who loses his job and returns to his village to farm family land is not unemployed. He is engaged in subsistence agriculture. The ILO model, applied to a labour market where formal jobs are scarce and survival strategies are universal, produces an unemployment rate that would be the envy of Germany. The model is statistically correct and analytically useless for policymaking in a country where one hour of work per week counts as employment.

The divergence matters because these modelled estimates are what international investors, development agencies, and policymakers consume. A portfolio manager in London looking at Nigeria sees a 4 percent unemployment rate and concludes that labour is tight, wages are rising, and the consumer class is expanding. He does not see the graduate driving a commercial tricycle because there is no office job. A bilateral aid agency sees low unemployment and redirects funding from employment programmes to financial sector reform. The models do not lie, but they answer the wrong question. They ask how many people are without work and seeking it. They do not ask how many people are with work that cannot sustain them.

The ILO models also miss the phenomenon of discouraged workers — those who have stopped looking because looking is futile. In the NBS 2020 survey, this group was substantial and growing. A graduate who has sent 200 job applications without a single interview eventually stops sending. A mother who cannot afford transport to job centres stops going. By ILO definition, they are not unemployed. They are outside the labour force, as if their absence were voluntary rather than forced. The models treat despair as choice.

Yemi Kale understood this. He resisted adopting the ILO one-hour methodology for ten years because, as he explained on Arise TV in August 2023, the income generated from one hour's work in Nigeria cannot sustain a worker. The 20-hour threshold used in the 2020 survey was chosen because a committee that included ILO representatives agreed it was the minimum that might generate enough income to equate to one hour of wages in the United States. Kale's successor abandoned that threshold. In August 2023, the NBS under Adeniran published a new unemployment figure of 4.1 percent for Q1 2023, using the one-hour ILO standard. The political utility of that figure was unmistakable. The analytical utility was zero.

The NBS 2020 survey used a broader definition, closer to the reality of underemployment and discouraged work-seeking that characterises Nigerian labour markets. Its 33.3 percent figure included those working fewer hours than they wished, those whose skills were mismatched to their work, and those who had abandoned the search. When the NBS stopped publishing regular quarterly surveys, the ILO models continued, generating numbers that bear no resemblance to lived experience. The lesson is not that the ILO is wrong. The lesson is that without primary data collection, models become fiction dressed in decimal points. Nigeria has chosen fiction, and the choice was made in the budget office as much as in the statistical bureau.

The definitional gap is not merely academic. It determines who receives development assistance, how investors price risk, and what policies governments adopt. When the NBS published 4.1 percent unemployment in August 2023, using the one-hour ILO standard, the figure was immediately useful to a government that wanted to claim progress. But it was useless to a policymaker trying to design a jobs programme. If a graduate who works two hours per week selling recharge cards is counted as employed, then no jobs programme is necessary. The data says the problem is solved. The reality says the problem has been redefined by statistical sleight of hand. Kale's 20-hour standard was not perfect, but it at least attempted to measure whether a worker earned enough to survive. The one-hour standard measures whether a worker is breathing.

The ILO itself does not mandate the one-hour standard as an exclusive measure. Its guidelines allow countries to adopt supplementary measures that reflect local labour market conditions. Nigeria chose to abandon its supplementary measure — the 20-hour threshold that Kale's committee had designed with ILO participation — and adopt only the narrowest international definition. The result is a statistical system that tells policymakers what they want to hear and tells citizens nothing about their actual economic condition. The NBS has not published a quarterly labour force survey since that 2023 release. The promise of regular measurement remains unfulfilled. The definitional gap has become a permanent feature of Nigerian economic governance.

The consequences of this definitional confusion fall heaviest on young Nigerians. A 25-year-old graduate who sells phone accessories for twelve hours a day is counted as employed by the ILO and as underemployed by the NBS 2020 methodology. Both definitions are methodologically defensible. Only one describes her lived reality. The policy that treats her as employed will not design a jobs programme for her. The policy that treats her as underemployed might, but that policy requires data that the state no longer collects. She is caught between two statistical regimes, and neither regime serves her.

The State as Job Destroyer

The demography is unforgiving. With approximately 4 to 5 million new entrants to the labour market each year, the economy must create that many jobs simply to keep the unemployment rate stable. It does not. No Nigerian administration has presided over net job creation at that scale. The World Bank's April 2026 Nigeria Development Update noted that growth in services and industry has lagged agriculture, constraining poverty reduction. What the report described politely is that the sectors capable of absorbing mass labour — manufacturing, construction, formal services — are either stagnant or contracting relative to the population. The state has failed to create jobs. In some cases, it has actively destroyed the jobs that existed.

On 18 May 2022, Governor Babajide Sanwo-Olu of Lagos State announced a total ban on commercial motorcycle operations, widely known as okada, across six local government areas of the state. The ban took effect on 1 June 2022. The affected areas — Ikeja, Surulere, Eti-Osa, Lagos Island, Lagos Mainland, and Apapa — represent the commercial core of Nigeria's largest city. The governor acted under the Lagos State Transport Sector Reform Law of 2018, citing road safety and violent crime. The immediate trigger was the lynching of a sound engineer, David Imoh, by okada riders in Lekki following a dispute over ₦100 change. The policy response was not regulation, licensing, or phased transition. It was eradication.

The job destruction was immediate and quantifiable. Various estimates place the number of okada riders operating in Lagos at between 200,000 and 400,000. The International Centre for Investigative Reporting noted that an estimated 400,000 okada ply Lagos roads daily. Gokada, a bike-hailing startup, laid off approximately 7,000 riders following earlier restrictions. The six-LGA ban of June 2022 displaced tens of thousands of informal transport workers in a single week. Bolt, Uber, and independent operators combined saw their driver networks collapse in the affected zones. The state created an anti-okada enforcement squad of 600 personnel to ensure compliance. Motorcycles were seized and crushed. Riders who had invested their savings in purchasing bikes lost their capital and their livelihoods simultaneously.

This is job destruction by policy, which is analytically distinct from job creation failure. The okada ban did not fail to create employment. It removed employment that already existed. The riders were not stealing. They were filling a mobility gap that the state's bus system could not fill. Lagos Metropolitan Area Transport Authority data showed that commercial buses and taxis were inadequate to satisfy commuting demand. The okada riders provided last-mile transport in traffic-choked corridors. When they were removed, commuters walked. The state offered no scalable alternative — a few hundred LAGFERRY boats could not replace hundreds of thousands of motorcycle trips. The policy destroyed livelihoods without replacing them. For a chapter about missing jobs, the Lagos okada ban is the most concrete, named, dated example of the state making jobs disappear.

The enforcement was relentless and theatrical. Lagos State deployed 600 personnel across police, Nigeria Security and Civil Defence Corps, Lagos Safety Neighbourhood Corps, and Federal Road Safety Corps to enforce the ban. Motorcycles were seized and crushed before the public. By September 2022, the ban had expanded to additional local government areas including Kosofe, Mushin, Oshodi, and Shomolu. The state claimed 85 percent compliance within three days of each expansion. What it did not publish was the employment ledger: how many riders lost income, how many families lost their sole breadwinner, how many investors in motorcycle fleets lost their capital. The Lagos State government later inaugurated 500 buses to replace the okada, but 500 buses cannot replace 200,000 motorcycles. The arithmetic of substitution was never credible. The policy was designed to remove a visible nuisance, not to protect a livelihood.

The okada ban also illustrates a gendered dimension of policy-driven job loss. While the majority of okada riders are male, the informal transport ecosystem they supported employed women as dispatch riders, delivery agents, and market suppliers. When the bikes disappeared, the supply chains that moved goods from Lagos Island markets to mainland retailers seized up. The bread seller who relied on okada to deliver her stock had no delivery vehicle. The seamstress who sent finished clothes to customers by motorcycle courier lost her logistics network. Job destruction by policy cascades through the informal economy in ways that aggregate statistics never capture. The NBS does not survey this cascade. The ILO models cannot detect it.

Ninety Percent Informal

Where the formal sector fails, the informal sector absorbs. The International Labour Organisation, in its 2022 Nigeria country brief, estimated that 83.7 percent of non-agricultural employment in Nigeria is informal. ILO estimates range from 83.7 percent of non-agricultural employment to 92.3 percent of total employment when agricultural labour is included. The rate is even higher among women: the ILO estimated 96.0 percent of working women were in informal jobs in 2022, while the NBS 2020 survey found 77 percent of women in employment worked in the informal sector — the divergence reflecting different survey instruments and definitions. Among young people, informal employment surpasses the national average at 98 percent. For young women, the rate is nearly universal: 99.1 percent. These figures describe not a marginal survival strategy but the dominant mode of economic existence for the vast majority of Nigerians.

The NBS 2020 Labour Force Survey confirmed this pattern. Of the 46.5 million Nigerians recorded as employed in Q4 2020, 30.6 million worked 40 or more hours per week — what the survey classified as full-time. But full-time in Nigeria does not mean formal. It means persistent. The Small and Medium Enterprises Development Agency of Nigeria and the NBS, in their 2021 National MSME Collaborative Survey, confirmed that micro, small, and medium enterprises account for 96 percent of businesses, approximately 84 percent of employment, and 48 percent of GDP. These are 2021 survey figures, not the undated claims that have circulated for years. They are directionally consistent with older estimates but carry the authority of recent fieldwork.

The scale of the invisible economy is staggering, though exact measurement remains disputed. The NBS, in its 2016 formal and informal sector split of gross domestic product, found that the informal sector contributed approximately 50 percent of nominal GDP. The Moniepoint 2024 Informal Economy Report, derived from data on over two million businesses, estimated the informal economy at 58 percent of GDP. The World Economics Quarterly Informal Economy Survey places Nigeria's informal economy at 55 to 57 percent of GDP. The SMEDAN/NBS 2017 National Survey of Micro, Small and Medium Enterprises found that Nigeria had approximately 41.5 million MSMEs, with micro-enterprises accounting for 99.8 percent of the total. These enterprises contributed 49.78 percent of GDP and 76.5 percent of national employment. The range across sources — 50 to 65 percent of GDP — is wide, but the directional conclusion is robust. More than half of Nigeria's economic output occurs outside the tax net, the regulatory framework, and the statistical measurement system.

The Moniepoint 2024 report added granularity that official statistics lack. Of the informal businesses surveyed, 72.3 percent reported monthly revenues above ₦1 million. But 90 percent made less than ₦500,000 in monthly profit. Only 1.3 percent earned above ₦2.5 million monthly. The typical informal operator is young — 58 percent are under 34 — and entered informal work because of unemployment. Eighty-nine percent pay some form of tax, but these are market levies and local government charges, not corporate income tax. Eight in ten businesses have operated for less than five years. The informal economy is not a stable foundation. Informal work is a high-turnover, low-margin treadmill on which millions run without advancing.

What constitutes this invisible economy? The categories are specific and observable. Petty trading — market stalls, street hawking, sachet water sales in traffic — employs millions of women and youth. Artisanal work — carpentry, tailoring, phone repair, hairdressing — operates in rooms without electricity, using tools bought on credit. Domestic labour — cleaning, cooking, childcare — is performed overwhelmingly by women without contracts, minimum wages, or social protection. Subsistence farming — smallholders farming less than two hectares without irrigation, mechanism, or reliable market access — absorbs roughly a third of the labour force by some estimates. The NBS 2020 survey found that agriculture remained the largest employer, but agricultural employment in Nigeria is largely subsistence. Subsistence farming is not a destination. The farm is a last resort.

The link between education and informality is not accidental. The National Information Technology Development Agency reported that 85 percent of Nigerian graduates have no digital skills and cannot use basic office software. A study by Pitan Oluyomi and Adedeji S.O. of the University of Ibadan found a 60.6 percent skills mismatch among recent graduates. The universities graduate hundreds of thousands of students annually, but laboratories lack equipment, libraries lack current texts, and lecturers strike for months at a time. The graduate who has spent six years in a four-year programme because of strikes, who has never operated industry-standard software, and who has learned accounting theory without touching Sage or SAP, is not equipped for the labour market. She is equipped for the informal sector.

The gender dimension of informality compounds the injustice. Women are disproportionately represented in petty trading, food processing, and domestic services. They face additional constraints: limited access to land, exclusion from credit networks dominated by male guarantors, and the unpaid burden of childcare and household labour that formal employers do not accommodate. The ILO found that 90.5 percent of working women are in self-employment, compared to 84.2 percent of men. Self-employment in this context does not mean entrepreneurship. It means survival without an employer. Women in the informal sector work longer hours than men but earn less, a pattern documented across every region of Nigeria in the 2020 survey.

The NBS 2020 survey disaggregated unemployment by gender with precision that subsequent silence has erased. Female unemployment stood at 35.2 percent nationally against 31.8 percent for males. Female underemployment was 24.2 percent against 21.8 percent for males. In the 15-to-24 age bracket, the combined unemployment and underemployment rate for females reached 73.2 percent. These women are not uniformly distributed across the informal economy. They cluster in the lowest-margin activities: food processing, petty trading, and domestic labour. The woman who fries akara by the roadside works longer hours than the male okada rider she feeds, but her daily profit is a fraction of his earnings. She cannot scale her business because she has no collateral for credit. She cannot hire help because her margin does not permit it. She cannot formalise because the cost of registration exceeds her monthly revenue. The gender data from the 2020 survey is the last official measurement of this gap. No subsequent survey has updated it.

The informal worker pays no income tax, but she also receives no pension, no health insurance, no maternity leave, and no protection against arbitrary dismissal. The National Health Insurance Authority covers only 10 to 15 percent of Nigerians in formal schemes. She is outside the law not because she is lawless, but because the law has never bothered to reach her. The state does not regulate her hours, inspect her workplace, or guarantee her wages. In exchange, the state does not provide her with electricity, credit, or security. This is not a social contract. The arrangement is the absence of one. And now the state wants to tax her.

The policy response to informality has followed a predictable orthodoxy: formalise, register, regulate, and tax. The logic is seductive. If 90 percent or more of employment is informal, bringing even a fraction into the tax net would dramatically broaden the revenue base. The tax reform law signed in June 2025 and effective January 2026 aims to raise Nigeria's tax-to-GDP ratio from its current low base toward 18 percent. The Federal Inland Revenue Service collected a record ₦21.6 trillion in 2024, a 76 percent increase from 2023. The state is getting better at collecting money. The question is whether it has earned the right to collect it from those who receive nothing in return.

Consider what formalisation demands of a street vendor in Ibadan. She must register her business, keep accounts, file returns, and remit taxes. In exchange, the state offers her what, exactly? Electricity? The national grid collapses with such regularity that the Presidency spent ₦10 billion to take Aso Rock Villa off it. Credit? The Bank of Industry publishes annual reports on SME lending, but the vast majority of informal operators have no collateral, no credit history, and no relationship with a formal financial institution. Security? In many parts of Nigeria, the state cannot protect its own police stations. Contract enforcement? The judicial system is congested, slow, and expensive. The informal sector has not opted out of the state. The state has failed to provide the public goods that would make formal participation rational.

Local government authorities in states such as Lagos, Kano, and Anambra compound the problem. In many states, local councils impose levies on informal operators — market fees, hawking permits, environmental charges — that bear no relationship to service delivery. These are not taxes in the fiscal sense. They are extortion, collected by officials who provide nothing in return and punish non-compliance with confiscation or violence. The informal operator who pays these levies does not become formal. She simply becomes poorer. The state that cannot meter electricity has no moral standing to meter her cart.

The Enhancing Financial Innovation and Access organisation publishes annual surveys on access to financial services in Nigeria. These surveys consistently find that informal operators remain outside the formal banking system not because they are ignorant of its benefits, but because the system is not designed for them. A market woman who deposits her daily earnings in a savings group with her peers is not financially illiterate. She is financially rational. The formal bank requires a minimum balance she cannot maintain, documentation she does not have, and branches she cannot reach. Her informal savings group charges no fees, requires no paperwork, and meets under the same tree where she sells her goods. The state that wants to tax her has not built a bank that can serve her.

Some labour economists, including researchers at the Nigerian Economic Summit Group, have argued that the informal sector is not a problem to be solved but a resilient adaptation to state failure. Attempts to force formalisation — through taxation, regulation, or harassment by local government authorities — without delivering services in return may destroy livelihoods without creating replacements. A tax collector who shuts down an unregistered shop but cannot provide the conditions for a registered shop to survive is not expanding the economy. He is shrinking it. The carpenter who builds furniture without a workshop, the tailor who sews without reliable light, the trader who moves goods across states on roads that wreck her vehicle — these are not parasites. They are entrepreneurs operating under conditions that would bankrupt a formal business. They are, in a sense, the most efficient sector of the Nigerian economy, because they survive despite the state rather than because of it.

The Exit Route

Those who cannot find adequate work in Nigeria do not always stay. The emigration of skilled and unskilled labour — known colloquially as japa — has accelerated into a measurable exodus. Canada has become the primary destination. In 2022, Nigeria was the number one source country for new permanent residents in Canada, with 26,590 Nigerian-born individuals admitted — Immigration, Refugees and Citizenship Canada, Annual Report 2023. The United Kingdom has also seen a surge. Australia, the United States, and the United Arab Emirates have all recorded sharp increases in Nigerian visa applications since 2020. The japa wave is not a rumour. The exodus is a documented population transfer.

The General Medical Council of the United Kingdom registered 2,240 Nigerian-trained doctors with primary qualifications from Nigeria as of 2022. In a single year, 2021 to 2022, 1,807 Nigerian doctors were added to the UK register. The Medical and Dental Council of Nigeria issued approximately 12,000 to 15,000 verifications and attestations to Nigerian doctors seeking foreign registration between 2018 and 2022. Nigeria has approximately 35,000 registered doctors for a population of roughly 220 million. The doctor-to-population ratio is approximately 0.4 per 10,000, against the World Health Organisation minimum of 1 per 1,000. The health system is bleeding out through emigration.

The nursing exodus matches the medical brain drain. The Nigeria Nurses Association estimated that more than 15,000 nurses left Nigeria for the United Kingdom, Canada, and Australia between 2020 and 2024. The United States hosts approximately 3,000 Nigerian-trained doctors. These are not unskilled migrants fleeing poverty. They are skilled professionals fleeing a labour market that cannot absorb or reward their training. The cost of their education was borne by Nigerian taxpayers — federal universities, teaching hospitals, and licensure examinations. The benefit of their labour is captured by the National Health Service in London and the provincial health systems of Ontario and Alberta.

The cost of this brain drain is not merely the loss of skilled workers. The loss includes the public investment in their training. A doctor who graduates from the University of Lagos College of Medicine has been educated with federal and state funds — subsidised tuition, teaching hospital rotations, and licensure examinations underwritten by taxpayer money. When that doctor relocates to Manchester or Toronto, the investment stays in Nigeria but the returns accrue to the NHS or the provincial health plan. The Nigerian taxpayer has funded the training of a worker whose taxes will now build British roads and Canadian schools. This is not migration. That movement is a capital flight of human capital that no balance of payments statement records.

Another layer of survival is diaspora remittances. The Central Bank of Nigeria estimates that Nigerians abroad send home approximately $20.9 billion annually. These flows do not create jobs directly, but they sustain households that would otherwise collapse. A family in Anambra State whose son works in Houston can afford school fees, medical bills, and petty trading capital. A family without such a lifeline has none of these. The informal economy is thus subsidised by the global dispersal of Nigerian labour — the export of workers whose remittances keep those who remain alive. Remittance dependence is a labour market strategy, but not a development strategy. The country that exports its doctors and nurses to fill labour shortages in wealthier nations is not solving its unemployment problem. Nigeria is exporting its unemployment problem.

The japa phenomenon has a gendered dimension that is less visible but equally significant. Female nurses dominate the emigration statistics. Female engineers and accountants are also leaving in growing numbers. The women who remain in Nigeria's informal sector face a labour market that has lost its most skilled female professionals to foreign health systems and corporate offices. The exit route is not available to everyone. It requires a passport, a visa, and often an air ticket that costs more than a year's informal earnings. The nurse who can verify her credentials with the UK Nursing and Midwifery Council has an exit route. The market trader in Kano does not. The exit route is a selective pressure valve, and its selectivity deepens the gender gap in domestic economic opportunity.

Remittances of $20.9 billion annually are the second-largest foreign exchange inflow after oil revenue, according to the Central Bank of Nigeria. But remittances are a private transfer, not a public investment. They do not build roads, fund power plants, or train teachers. They sustain individual households at a level that masks systemic failure. A family receiving $500 per month from a son in Canada can afford private school fees, generator fuel, and medical bills at a private clinic. The family next door without a diaspora connection has none of these options. Remittances thus create a two-tier welfare state: one funded by foreign salaries, the other left to the collapsing public system. The japa economy is not a solution to unemployment. Remittance dependence is a privatised coping mechanism that deepens inequality between families with foreign connections and those without.

Counting What Cannot Be Counted

In the absence of official labour market data, proxies emerge. They do not replace a proper survey, but they illuminate corners that the NBS no longer visits. Moniepoint, a financial technology company, reported over 2 million merchants on its platform as of 2024. These are micro-businesses — market stalls, neighbourhood shops, roadside vendors — that process digital payments through point-of-sale terminals. Their transaction volume is a proxy for informal economic activity. When Moniepoint processes approximately ₦2 trillion in transactions per month, it is measuring a layer of commerce that the NBS statistical framework barely recognises.

The gig economy produces its own shadows. Bolt and Uber operate in Lagos, Abuja, and Port Harcourt, but neither publishes Nigeria-specific driver counts. The available estimates suggest 600,000 to 700,000 registered drivers across platforms in major cities. PalmPay and OPay claim over 1.5 million registered agents processing transactions through informal networks. These agents are not employees. They are independent operators who earn commissions on cash-in and cash-out services. Their work is invisible to the NBS, but it is visible in the transaction logs of the fintech platforms that employ them.

The point-of-sale agent network is perhaps the most significant unmeasured labour force in Nigeria today. Following the Central Bank of Nigeria's cashless policy and the chaotic currency redesign of early 2023, digital payment adoption doubled among informal businesses. Moniepoint data shows that card payments became the most common transaction method for informal merchants, exceeding cash in some categories. Each POS terminal represents an independent agent who has purchased or leased the device, paid for data connectivity, and built a customer base. These agents are employers of sorts — many hire assistants to manage peak hours. They are also creditors, extending informal credit to trusted customers. The NBS has no category for POS agent. The labour force survey that might have counted them has not been conducted since 2020. Yet their number — likely in the millions — represents one of the few growth areas in Nigerian employment, a growth that occurred not because of policy design but because of policy chaos.

Other proxies fill the measurement void in different ways. The Jobberman Foundation reported in 2025 that six out of ten Nigerian graduates lack the necessary skills for available jobs. Stutern estimated in 2022 that only 10 percent of Nigerian employers view graduates as job-ready. These are not labour force surveys, but they measure the same mismatch from the demand side. When employers consistently report that graduates cannot perform the tasks for which they were trained, the labour market is sending a signal that the NBS no longer records. The signal is that Nigeria's education system produces inputs for an economy that does not exist.

Andela provides a different kind of proxy. The company, founded in 2014, originally ran a four-year residential training programme for African software developers, placing them with global technology firms. Between 2020 and 2021, Andela pivoted from residential training to a "talent cloud" model — connecting African engineers to global remote opportunities on a contract basis. The shift was commercially rational. It was also an admission that the Nigerian formal employment market could not absorb the engineers Andela trained. By 2023, Andela's talent network exceeded 175,000 engineers. These are Nigerians earning dollar salaries while physically resident in Lagos. They are employed, but not by Nigeria. Their employment is a bypass of the domestic labour market, not a product of its health. The specific companies, their valuations, and their structural significance are documented in Chapter 9.

The technology sector demonstrates that high-quality employment is possible for a fraction of the labour force — a fraction that is real, remarkable, and orders of magnitude below what a labour market absorbing four million annual entrants requires. Paystack, acquired by Stripe for $200 million in 2020, and Flutterwave, valued at $3 billion in 2022, are genuine success stories. They are also statistically irrelevant to the labour market as a whole. The total employment generated by Nigeria's technology ecosystem is measured in the tens of thousands. Technology employment is not measured in millions. The sector is highly skill-intensive, requiring levels of education, internet access, and technical training that exclude the vast majority of labour market entrants. The ecosystem is concentrated in Lagos and a handful of other urban centres. The technology sector shows that the Nigerian economy can create high-quality employment for a tiny elite, but it cannot create mass employment at any quality level.

The tragedy is that the informal sector contains genuine productive capacity that the state neither serves nor understands. The carpenter who builds furniture without a workshop, the tailor who sews without reliable light, the trader who moves goods across states on roads that wreck her vehicle — these are not parasites. They are entrepreneurs operating under conditions that would bankrupt a formal business. Their productivity is invisible in GDP calculations, uncounted in employment surveys, and ignored in policy design. They are the missing jobs — not missing because they do not exist, but missing because the state has never bothered to see them. And now the state wants to tax them.

In FY2025, the Federal Government appropriated ₦18.53 trillion and released ₦834.8 billion against that appropriation by July 2025 — a capital budget execution rate of 7.72%. The workers who could not find formal jobs were not imagining the country's infrastructure decay. They were living inside it. The arithmetic of what was budgeted, what was released, and what was built — and who profited from the gap — is the subject of Chapter 6.

Sources

  1. National Bureau of Statistics (NBS). Nigeria Labour Force Statistics: Unemployment and Underemployment Report Q4 2020. March 2021. nigerianstat.gov.ng
  2. International Labour Organisation (ILO). Nigeria Policy Brief: Informal Employment and Working Poverty. November 2024. ilo.org
  3. United Nations Population Division. World Population Prospects 2024. 2025 estimates.
  4. World Bank. Nigeria Development Update: Nigeria's Tomorrow Must Start Today. April 2026.
  5. Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and National Bureau of Statistics (NBS). National MSME Collaborative Survey 2021. smedan.gov.ng
  6. Moniepoint. 2024 Nigerian Informal Economy Report. July 2024. moniepoint.com
  7. Immigration, Refugees and Citizenship Canada (IRCC). Annual Report to Parliament on Immigration 2023. canada.ca
  8. General Medical Council (UK). State of Medical Education and Practice in the UK 2022. gmc-uk.org
  9. Central Bank of Nigeria (CBN). Diaspora remittance estimates and balance of payments data. 2023.
  10. National Information Technology Development Agency (NITDA). Digital skills assessment report. 2024. nitda.gov.ng
  11. Pitan Oluyomi S. and Adedeji S.O. "Skills Mismatch Among University Graduates in the Nigeria Labour Market." International Journal of Business and Social Science. 2012.
  12. Jobberman Foundation. Nigeria Graduate Skills Gap Report 2025. jobberman.com
  13. International Centre for Investigative Reporting (ICIR). "Commuters groan as Lagos govt enforces ban on okada operations." June 2022. icirnigeria.org
  14. Debt Management Office (DMO). Quarterly Debt Report Q4 2025. February 2026. dmo.gov.ng
  15. Budget Office of the Federation. 2025 Budget Implementation Report (January–July). 2025. budgetoffice.gov.ng
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