TABLE OF CONTENTS
CHAPTER
ONE:
Introduction......................................................................................1
1.1.
Background of the study...............................................................................................
1
1.2.
Statement of the problem
......................................................................... 2
1.3. Aims
and Objective of the study ...............................................................................
3
1.4.
Relevant Research
Questions..................................................................................
3
1.5.
Relevant Research Hypothesis .................................................................................
4
1.6.
Significance of the study
................................................................................................
4
1.7.
Scope of the Study ..............................................................................................
5
1.8
Definition of Terms ……………………………………………………………….
1.9 References
………………………………………………………………
CHAPTER
TWO: Literature Reviews..........................................................................
6
2.0
Preamble…………………………………………………………………………..
2.1 Definition and Types of Unemployment
………………………………
2.2.0
Theoretical framework of the study.
2.2.1 Classical
Theory of unemployment
2.2.2 Keynesian theory of unemployment
2.2.3 Malthusian Population Trap
2.2.4 Theory of Consumer Behavior and Fertility
2.3
Empirical Literature Review
CHAPTER THREE
METHODOLOGY
3.1 Preamble
3.2
Theoretical Framework
3.3 Model
Specification
3.4
Description and measurement of variables
3.5 Method of
Data Analysis
3.5.1 Unit Root or Stationarity Test
3.5.2 Co integration Test
3.5.3 Granger causality test
3.5.4 Ordinary Least Squares Techniques
References
CHAPTER FOUR
DATA
PRESENTATION AND ANALYSIS
4.1 Preamble
4. 2.
Presentation and Analysis of Data
4.3 Test of Hypotheses
4.3.1 Presentation and Analysis of Unit Root Test
Results
4.3.2 Presentations and Analysis of Johansen
Co-integration Test Result
4.3.3 Presentation of Granger Causality Test
Results and interpretations
4.3.4 Presentation
of Ordinary least Squares Results and Interpretations
4.3.5
Presentation and interpretation of results
4.4 Discussion
of Findings
CHAPTER FIVE
SUMMARY,
CONCLUSIONS AND RECOMMENDATIONS
5.1 Summary
5.2 Conclusion
5.3
Recommendation
Bibliography
Appendix
CHAPTER
ONE
Introduction
·
Background
of the study
The alarming rate of population growth and
unemployment in Nigeria currently calls for great concern among policy makers
to formulate effective and efficient economic policies to arrest this ugly
trend. In recent time, one of the
greatest problems of population growth in Nigeria is not simply a problem of
numbers, it is a problem of human welfare and of development as rapid
population growth can have serious consequences for the well- being of the
citizenry. According to recent statistics made available by PMC (population
media center, 2015) Nigeria is currently the 8th most populous country in the
world with a population size of 182,201,962 and population growth rate of 2.54
percent. It is expected that it will double in the next 28 years if left
unchecked.
If development entails the
improvement in people’s standard of living - their incomes, health, education
and general well-being - and if it also encompasses their self-esteem, respect,
dignity and freedom of choice as seen by ( Amartya Sen, 1999) then, the really
important question about population growth is how does the Nigeria population
growth contribute to, or detract from
the chances of Nigeria realizing
the goals of development, not only for the current generation but also for the
future generations. Furthermore, how will
Nigeria be able to cope with the
vast increases in the labour force over
the coming decades? Will employment opportunities be plentiful? Or will it be a major achievement just to keep unemployment levels from rising?
According to National Bureau of
Statistics, (2016) first quarter, the
national unemployment rate was 5.5% and the labour force participation rate was
recorded at 71.1%. The highest unemployment rate was among females (5.7%)
compared to males (5.2%).
It is in the light of the forgoing issues in an attempt to answer these
critical questions that this study tends to evaluate the impact of population
growth rate on the level of unemployment in Nigeria. This is because the population growth rate of
a country remains a critical factor in the development of the economy and where
not properly managed, could inflate the scourge of poverty in the economy. On
the other hand, population growth can be a useful factor in providing a
workforce for the production of goods and services to boost economic
development, and remains a critical determinant of the potential of a country’s
investment. It can act as a double
–edged sword on the economy of that country.
Empirical evidence also indicates
that rapidly growing population rate has serious implications for the provision
of productive employment or decent work, since rapid population growth is
normally accompanied by a proportionate increase in the supply of the labour
force; it means that the rate of job creation should match the rate of supply
of the labour force.
Within the Nigerian context, the rate of labour force supply has
outnumbered that of job creation, implying that the rates of unemployment or
youth unemployment rate have been increasing rapidly. In other words, the number of people seeking
employment increases more rapidly than the number of available jobs. This kind of situation poses grave danger to
the society.
According to a Research study carried out by (United Nations, 2006),
they looked at the consequences of High population growth rate on unemployment
level. Their research findings clearly show that when an ever-growing number of workers
cannot be absorbed in the modern economic sectors of the country’s economy, the
workers are forced either into unproductive service occupations or back into
the traditional section with its low productivity and low subsistence wage
levels. This large supply for cheap
labour tends to hold back technological change, and industrialization is slowed
by mass poverty, which in turn reduces
the demand for manufactured goods. The
end results are low saving rates and low labour skills, both of which hinder
the full development and utilization of natural resources, joblessness,
frustration and disappointment, high rate of social vices and criminal
activities such as robbery, prostitution, drug trafficking, underdevelopment
trap, widespread of extreme poverty and hunger {absolute poverty), youth
restiveness, if not controlled, apathy, cynicism and revolution might also become
the consequence.
·
Statement of the problem
Unemployment
and increased population growth rate create serious social problems as
discussed above. It not only affects the economic and socio-political life of
the citizens of Nigeria but as well brings serious concerns to international
organizations and donor agencies in tackling the problems discussed above and
calls for concern to look into the policies put in place by policy makers in
the country to checkmate and address this ugly trend in Nigeria.
The impact of population growth on the unemployment level in Nigeria has
consequences not only to the present generation but also generations yet to
come. According to the national Bureau
of Statistics (2016), the Nigeria unemployment rate was recorded at 12.1 percent
in March 2016, up from 10.4 percent in the last quarter of 2015, reaching the
highest level since December 2009. The number of unemployed persons rose by 1.8
percent to 9.485 million, employment grew a meager 0.12 percent to 69 million
and labour force went up 2 percent 78.4 million. Meanwhile, youth unemployment
increased to 21.5 percent from 19 percent. Unemployment Rate in Nigeria
averaged 9.04 percent from 2006 until 2016, reaching an all-time high of 19.70
percent in the fourth quarter of 2009 and a record low of 5.10 percent in the
fourth quarter of 2010.
Rapid population
growth in Nigeria is equally associated with unemployment with figures ranging
from 17 percent per annum for the entire population to 60 percent for the
youths because job opportunities are fewer than the number seeking for them,
and stagnating the economy because a
large proportion of available resources is consumed instead of being invested
to generate growth.
The impact of population growth on
unemployment level in Nigeria has continued to draw conflicting conclusions
among the scholars because there is no agreement among scholars on the
direction of causality between the impact of population and unemployment. This could generate problems among the
policy makers when formulating policies for the Nation.
Furthermore, the
different methodologies adopted by different researchers over the years also
contribute to the conflicting submissions and inferences drawn among the
scholars and this can create methodological problems for the upcoming
researchers who may want to carry out further studies relating to this topic.
For instance, some scholars and researchers through their findings indicate
that there is long run, significant effect and causal relationship between
population growth rate and unemployment level in Nigeria. While others show
that there is no long run, significant effect and causal relationship between
population growth and unemployment level in Nigeria.
It is therefore the
goal of this study to reconcile the conflicting views and perception of the
various researchers and scholars in trying to identify if indeed, there exist a
direct causal relationship, a significant effect and a long run relationship
between population growth and unemployment level in Nigeria between 1991 and
2015
1.3 Aims
and objectives of the study
This research aims to identify the impact of
population growth on unemployment level in Nigeria in terms of how it has
affected the people and as well as the economy for the period 1991 to 2015. With the aim to appraise the various alternative
policy options available on the impact of population growth on Unemployment in
Nigeria in other to provide the best policy recommendations. The specific objectives of this study are:
[1] To determine
whether a long- run relationship exists between population growth and
unemployment level in Nigeria
[2] To investigate the causal relationship
between population growth and unemployment level in Nigeria
[3] To ascertain the statistical significant effect of population growth on unemployment
level in Nigeria using Ordinary least square method in other to curb the
problem of population growth rate and unemployment level in Nigeria.
·
Relevant
Research questions
1 What is the long-
run relationship between population growth rate and the level of unemployment
in Nigeria?
·
Is there
any causal relationship between population growth and unemployment level in
Nigeria?
·
Does
population growth rate have a significant effect on the unemployment level in
Nigeria?
1.5 Relevant Research Hypotheses
Hypothesis
1
H0: There is no long -run
relationship between population growth and unemployment level in Nigeria.
H1: There
is a long- run relationship between population growth and unemployment level in
Nigeria.
Hypothesis
11
H0: There
is no causal relationship between
population growth and unemployment level in Nigeria.
H1: There
is a causal relationship between population growth and unemployment level in
Nigeria.
Hypothesis
111
H0:
Population growth has no significant effect on unemployment level in Nigeria
H1:
Population growth has a significant effect on unemployment level in Nigeria
1.6 Significance of the study
The
significance of this study cannot be
over emphasized. Firstly, the study
intends to evaluate the link between population growth rate and the level of
unemployment in the country. The Knowledge gained will be of immense benefit to
policy makers as a framework to develop or design policies and strategies to
curb the nagging issues of unchecked population growth rate and unemployment in
the country.
The
ultimate gain is that if population growth is properly checked and unemployment
is successfully resolved, it will lead to increase in the level of productivity
in the country and also bring about increase in the level of economic growth
and development in the country and improve standard of living of the citizenry.
Government
and its agencies will find this research study useful because the findings that
will be embarked on in this research will provide a blue- print for government
policies towards the reduction of unemployment and to check population growth
in order to educate the citizen in the importance of family planning.
1.7
Scope of the study
The scope
of this study will be limited to the use of secondary data of population
estimates from 1991 to 2015. It will also be limited to the study of
unemployment trends within the year under review as mentioned above from the
National Bureau of statistics, CBN statistical bulletin and World Bank data
base. It is not concerned with the population growth rates and unemployment
trends in the previous years. The Secondary data that will be gathered from the
sources mentioned above will be used to test the stationarity of the data using
unit root test (ADF) to avoid running a spurious regression result and run a regression result to test the
statistical significant of the impact of population growth rate on unemployment
level. The data will also be used to determine if there exists a long- run
relationship between the impacts of population growth on unemployment level
using Johansson co-integration test. Finally, the data will be used to confirm
the causal relationship existing between population growth rate and
unemployment level in Nigeria using granger causality test.
1.8
Definition of Terms
Absolute
poverty: A condition
characterized by severe deprivation of basic human needs, including food, safe
drinking water, sanitation facilities, health, shelter, education and
information.
Development:
Amartya Sen (1999) , defined
development as the removal of major sources of un-freedom, poverty, tyranny,
poor economic opportunities, systematic social deprivation, and neglect of
public facilities as well as intolerance or over state activities of the state.
Decent
work / productive employment: According to Department of Economic and Social Affairs,
(2006) Decent work involves
opportunities for work that is productive and delivers a fair income, security
in the workplace and social protection for families, better prospects for
personal development and social integration, freedom for people to express
their concerns, organize and participate in the decisions that affect their
lives and equality of opportunity and treatment for all women and men.
Economic
growth: (Michael P. Todaro and Stephen C . Smith,
2011) Defined economic growth as a steady process by which the productive
capacity of the economy is increased overtime to bring about rising level of
National output and income.
Family
planning: The practice of controlling the number of
children in a family and the intervals between their births, particularly by
means of artificial contraception or voluntary sterilization. According to WHO,
Family planning allows individuals and couples to anticipate and attain their
desired number of children and the spacing and timing of their births. It is
achieved through use of contraceptive methods and the treatment of involuntary
infertility. A woman’s ability to space and limit her pregnancies has a direct
impact on her health and well-being as well as on the outcome of each
pregnancy.
Labour
force / work force: it is the total labour force which comprises
people aged 18 and above who meet the International Labour Organization
definition of the economically active population. All people who supply labour
for the production of goods and services during a specified period. It includes
both the employed and the unemployed. While national practices vary in the
treatment of such groups as the armed forces and seasonal or part-time workers,
in general, the labour force includes the armed forces, the unemployed and
first-time job-seekers, but excludes homemakers and other unpaid care-givers
and workers in the informal sector.
Labour
force participation rate: The
labour force participation rate, LFPR (or economic activity rate, EAR), is the
ratio between the labour force and the overall size of their cohort (national population of the same age range). The term
generally excludes the employers or management , and can imply those involved in manual labour.
It may also mean all those who are available for work
Underemployment: The condition in which people in a labour
force are employed at less than full-time or regular jobs or at jobs inadequate
with respect to their training or economic needs.
Unemployment
rate: Unemployment rate is defined basically as
the percentage of the total labour force that is unemployed but actively
seeking employment and willing to work.
Unemployed
Person: The IntHYPERLINK
"http://www.investopedia.com/terms/i/international-labour-organization.asp"ernational
Labor Organization (ILO) defined an unemployed person as someone who
is actively looking for work but does not have a job. The unemployment rate is
a measure of the number of people who are both jobless and looking for a job. This measurement is
considered a lagging indicator, confirming but not foreshadowing long-term market
trends.
Unemployed
population: This refers to persons in the working age
population, who during the reference week:
(a) Were not employed, (b) Were available to take up work if such was
found (c) Were actively looking for work during the previous 4 weeks. (National bureau of statistics 2015)
Youth
Unemployment rate:
According to (MDGs, 2015), the youth unemployment rate is the proportion of the
youth labour force that is unemployed. Young people are defined as persons aged
between 15 and 24. The unemployed comprise all persons above a specified age
who, during the reference period, were: (a) without work; (b) currently
available for work; and (c) actively seeking work.
Supply of
labour: The labour supply is the number
of hours people are willing and able to supply at a given wage rate. It is the
number of workers willing and able to work in a particular job or industry for
a given wage. The extent to which a rise in the prevailing wage or salary in an
occupation leads to an expansion in the supply of labour depends on the
elasticity of labour supply.
Poverty: A poor man in Kenya Defined poverty as “Don’t
ask me what is poverty because you have met it outside my house. Look at the
house and count the number of holes. Look at the utensils and count the cloths
I am wearing. Look at everything and write what you see. What you see is
poverty. (Extracted from Todaro and Smith Economic development) .
Population
growth rate: The "population growth rate" is the
rate at which the number of individuals in a population increases in a given
time period, expressed as a fraction of the initial population. Specifically,
population growth rate refers to the change in population over a unit time
period, often expressed as a percentage of the number of individuals in the
population at the beginning of that period. This can be written as the formula,
valid for a sufficiently small time interval.
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