About 34.3% of Nigerian workers, aged 15 and older, are working poor, living below the poverty line despite being employed.
This is according to the Nigeria Country Diagnostic Note (CDN) 2023 by the African Development Bank (AfDB), which was published on Tuesday on the bank’s website.
According to the new document, many workers in Nigeria are trapped in poverty due to low-skilled and low-wage jobs.
The document read:
The output per worker fell sharply from an 8.7% growth rate in 2013 to a decrease of 0.8% in 2022. Such declining productivity not only reflects economic challenges but also suggests that many firms struggle to adjust their workforce in response to changing economic conditions.
It stated:
Education plays a crucial role in economic mobility, yet in Nigeria, it remains a significant barrier for many. According to the report, about 60% of employed Nigerians lack basic education, which consigns them predominantly to the informal sector and agricultural jobs, known for their low pay.
This situation is exacerbated by the fact that only a small fraction of the workforce achieves higher education levels, further restricting their opportunities for better employment.
It added that 41% of Nigeria’s workers were in low-skilled jobs, 28% in medium-skilled jobs, and only 31% in highly-skilled jobs.
Skill mismatches and educational inadequacies not only affect individual workers but also pose a broader challenge to the country’s economic progress.
The report noted that there has been some progress in reducing overall poverty in Nigeria. From a high of 62.2% in 2009, the income poverty rate has dropped to 40.1%, representing 82.9 million Nigerians living below the poverty line.
This decrease reflects significant efforts and some economic improvements over the past decade. However, the poverty gap and severity remain substantial issues, with projections suggesting a potential rise in poverty due to factors like the COVID-19 pandemic, high population growth, and economic stagnation.
With an estimated annual need of N3.7 billion to eradicate poverty, focusing on educational enhancements and economic diversification will be key to lifting more Nigerians out of poverty and preventing the vulnerability that comes with economic shocks.
The report added: