Rural unemployment rises to 4.3% in Q1 2024 as Nigeria’s labour force participation drops 

Rural unemployment in Nigeria has surged to 4.3% in the first quarter of 2024. It rose from 2.9% in Q1 2023, a 1.4%-point increase, and up 0.3%-point from Q3 2023.  

This is according to the Nigeria Labour Force Survey (NLFS) report released by the National Bureau of Statistics (NBS). 

The figures from the report reflect the increasing challenges facing rural Nigerians in the labour market, where a combination of rising unemployment, shrinking labour force participation, and persistent underemployment is taking a toll. 

The report highlights significant shifts in Nigeria’s labour market, with rural Nigerians bearing the brunt of these changes as the overall labour force participation rate dropped to 77.3%, down by 2.2%-points from 79.5% in Q3 2023. 

It read: “The labour force participation rate among the working-age population declined to 77.3% in Q1 2024 from 79.5% in Q3 2023.” 

In Q1 2024, rural participation stood at 82.5%, while to urban participation was 74.0%. Also, about 97.6% of rural dwellers worked informally. This figure is higher than the urban informality rate of 89.0%, highlighting the disparity between rural and urban labour conditions. 

The overall employment-to-population ratio also fell to 73.2% from 75.6% in Q3 2023, with rural areas experiencing a slight drop from 80.7% to 78.9% during the same period. 

The rise in rural unemployment follows challenges in key economic sectors such as agriculture, which remains the primary employment source for rural Nigerians. 

Despite these challenges, 40.7% of the rural workforce remains engaged in agricultural activities, contributing to Nigeria’s informal economy. 

However, the increase in discouraged job seekers, which rose to 5.0% in rural areas from 3.0% in Q3 2023, signals a growing frustration among rural Nigerians in securing employment opportunities. 

The report also shows that time-related underemployment, which captures individuals working less than 40 hours per week but willing and available to work more, stood at 11.8% in rural areas, down from 12.3% in Q3 2023. 

Although this reduction could indicate some improvements in working conditions, the rural labour force still faces substantial underutilization. Also, labour underutilization, combining time-related underemployment and unemployment, reached 15.6% in rural areas. 

This rise in unemployment is likely influenced by insecurity in many rural regions. Insurgency, banditry, and communal conflicts have displaced large numbers of people, leading to the abandonment of farms and other sources of livelihood. 

Many rural areas, particularly in northern Nigeria, are experiencing declining economic activity as insecurity forces people to leave their homes, severely restricting employment opportunities. 

Additionally, periodic flooding, which is becoming more frequent due to climate change, has also disrupted agricultural activities, leading to lower productivity and loss of jobs in key rural sectors like farming and fishing. 

The International Monetary Fund (IMF) recently urged Nigeria to expand its cash transfer program to include rural areas in response to the country’s growing challenges of food insecurity and rising poverty. 

It stressed the importance of broadening the scope of the cash transfer system to ensure that vulnerable populations, particularly in rural communities, receive the necessary support.