According to data released by the National Bureau of Statistics (NBS), 85.6% of Nigeria’s working-class population works for themselves, demonstrating the prevalence of self-employment in the country’s labor market.
The most recent Q2 2024 Labour Force Survey from the NBS, which also shows changes in employment trends brought on by structural and economic factors, emphasized this finding.
The research breaks down employment into two primary groups: self-employed and employees.
Self-employed people, often known as own-account workers, run their own enterprises alone or in collaboration with partners, whereas employees—including paid apprentices—receive pay or salary.
What The Data Indicates
- Although it decreased from 88% in Q2 2023, the percentage of self-employed people increased little from 84% in Q1 2024.
- According to a gender-disaggregated analysis, while self-employment is still more common among women, wage-based employment is dominated by men. Self-employment was greater among women (88.3%) than men (82.2%). Because women frequently have less access to official career possibilities, they are more likely to work in informal jobs.
- Regionally, self-employment rates were substantially higher in rural areas (94.3%) than in urban areas (79.7%), indicating differences in employment patterns between urban and country areas. The NBS ascribed the high rates of self-employment in rural areas to the predominance of trade and agricultural activities in these regions.
Informal Employment Is Still The Most Common
According to the NBS study, 93% of all jobs in Nigeria were in informal employment in Q2 2024, demonstrating the continued dominance of this sector of the labour market.
- This indicates the continued reliance on informal work for sustenance across the nation, a small increase from 92.7% in Q1 2024.
- The information shows that informality is still prevalent, especially among less educated people. Informal workers comprise 99 percent of all workers and are the majority without formal schooling.
- In contrast, only 26.6% of people with post-secondary education work informally, making them much less likely to do so.
- The trend continues when agriculture is excluded, with the percentage of people in informal work falling to 14.7% for those with post-secondary education but staying at 98.4% for those without formal education.
There are also clear gender differences, with women being more likely than men to work informally. Compared to 90% of workers in urban areas, 97.5% of workers in rural areas work informally, indicating considerably greater rates of informality.
This gap between rural and urban areas highlights how small businesses and agriculture contribute to rural employment and how formal employment possibilities are scarce.
What To Note
- The employment-to-population ratio rose from 73.2% in Q1 2024 to 76.1% in Q2 2024, indicating a more engaged workforce across all labour indices. In Q2 2024, the labour force participation rate increased somewhat to 79.5%, indicating a consistent rebound from earlier quarters’ volatility. This trend indicates increased economic activity, especially in the unorganised and self-employed sectors.
- According to a previous article by THE NEWS CHRONICLES, Nigeria’s unemployment rate dropped by one percentage point from 5.3% in the first quarter of 2024 to 4.3% in the second quarter. However, when compared to the same period in 2023, the rate increased marginally by 0.1 percentage points annually.
- In addition to affecting work stability, the high rate of informality and self-employment limits access to social safeguards, including unemployment insurance, healthcare, and pensions. Better support for informal workers and the creation of formal job paths are essential for social and economic development as Nigeria continues to face economic difficulties.
