How Nigeria defines Employment, Underemployment and Unemployment



Sunday, August 02, 2015 11.48 PM / NBS

In computing the unemployment rate, the total population is divided into labour force (currently active) and nonlabour force (not currently active). The labour force population covers all persons aged 15 to 64 years. The definition of unemployment therefore covers persons (aged 15–64) who during the reference period were currently available for work, actively seeking for work but were without work. A person is regarded as employed if he/she is engaged in the production of goods and services, thereby contributing to the Gross Domestic Product (GDP) in a legitimate manner, which is a component of the national accounts and receives any form or amount of compensation for that activity.

The category of persons considered not in the labour force include those not between1564 (economic active population) as well as those within the economically active population i.e 1564, who are unable to work, not actively seeking for work or choose not to work and/or are not available for work. Examples of these are voluntary full-time housewives, underage children 14 and below, adults above 65, full time students, those in active military service, physically challenged and incapacitated persons whose incapacitation prevents them from working. Growth in the labour force therefore fluctuates and depends on the decisions by members of the economically activate population on whether to work or not which varies across different cultures, religion, as well as various academic, economic and family considerations.

There is no standard definition of unemployment as various countries adopt definitions to suit their local priorities. Virtually all countries however use the International Labour Organization (ILO) definition, or a variant of it to compute unemployment. The ILO definition covers persons aged 15–64 who during the reference period (usually the week preceding the survey period for at least one hour), were available for work, actively seeking for work, but were unable to find work.

The Nigerian National Bureau of Statistics like most countries in the world now uses a variant of the ILO definition such that the unemployment is the proportion of those in the labour force (not in the entire economic active population, nor the entire Nigerian population) who were actively looking for work but could not find work for at least 20hours during the reference period to the total currently active (labour force) population.


Accordingly you are unemployed if you did absolutely nothing at all or did something but not for up to 20 hours in a week. Underemployment however occurs if you work less than full time which is 40 hours but work at least 20 hours on average a week and /or if you work full time but are engaged in an activity that underutilizes your skills, time and educational qualifications.

Accordingly rural farmers only farming seasonally will be considered underemployed if they only work on their farms during the planting and harvests period and do nothing in between. If farmers are however working in dry and wet season as is the case recently they will be considered involved in full employment.

This applies to drivers, cook, bankers, teachers etc who in most case work well over 40 hours and hence are considered fully employed as their working hours and often skills meet the adopted methodology. It is important to note that the pervasive international definition of unemployment, underemployment or employment is not a function of the quantity/suitability of wages earned, nor on whether the person involved in a particular job or economic activity is looking for another job or unhappy with his current job.

Rather employment, underemployment and unemployment are treated as a function of a person’s involvement or otherwise in economic activity even if that activity is aimed at making ends meet. The suitability of wages is covered under other quality of living standards indicators such as poverty etc and not in determining whether one is employed, unemployed or underemployed which is a function of economic engagement.


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