THE EFFECT OF URBANIZATION AND UNEMPLOYMENT ON THE NIGERIAN ECONOMY


THE EFFECT OF URBANIZATION AND UNEMPLOYMENT ON THE NIGERIAN ECONOMY

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ABSTRACT

The work is motivated by the seeming inability of the public sector to make and implement polices and programmes to curb the high rate of rural – urban migration and unemployment that is usually experienced in Nigeria. The study was geared towards an overview of the issues of urbanization and unemployment as well as their implication on the development of Nigeria. Secondary data were collected and analyzed using ordinary least square method. The result obtained from the analysis shows that urbanization has a significant impact on economic growth. It was then recommended that government should strive more to make access to higher education, scholarship and agricultural facilities available to the rural populace and further enhance effort towards population control through public –private sector to make a productive life worth living in rural areas.

TABLE OF CONTENTS

Title Page i

Approval Page ii

Dedication iii

Acknowledgement iv

Abstract v

Table of Contents vi

CHAPTER ONE

INTRODUCTION

1.1Background of the study1

1.2Statement of Problem5

1.3Objective of the Study6

1.4Research Question6

1.5Statement Of the Hypothesis7

1.6Significant of the Study7

1.7Scope of the Study7

1.8Definitions of Terms8

1.9Organization of the Study12

CHAPTER TWO

REVIEW OF LITERATURE

2.1.1Theoretical review of Literature27

2.2Causes of Urbanization30

2.3Changing Forms of Urbanization36

2.4Review of Urbanization in Nigeria37

2.5Theoretical Literature on Unemployment42

2.6Review of Unemployment in Nigeria.45

2.7 The Link Between Urbanization and Unemployment in Nigeria47

2.8The Empirical Study of Unemployment and Urbanization48

CHAPTER THREE

RESEARCH METHODOLOGY

3.1Urbanization and Unemployment56

3.2Sources of Data56

3.3Method of Data Collection57

3.4Restatement of Hypothesis57

3.5Model Specification58

3.6Method of Data Analysis60

3.7Education of the Estimates61

3.8Testing of Hypothesis62

CHAPTER FOUR

PRESENTATION AND ANALYSIS OF DATA

4.1Presentation and Analysis of Data64

4.2Interpretation/Evaluation of Result65

4.3Hypothesis Testing74

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATION

5.1Discussion of Findings75

5.2Summary75

5.5Conclusion76

5.6Recommendations77

BIBLIOGRAPHY78

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The rate of urbanization is increasing in both the developed and developing countries. However, rapid urbanization, particularly the growth of large. Cities and the associated problems of unemployment, poverty, inadequate health care, poor sanitation, urban slums and environmental degradation pose a formidable challenge in developing countries. Available statistics shows that more than half of the world lives in urban areas at the end of 2010 from 49% (3.2billion) in 2008. the same report projected that figure is likely to rise to 60% (4.9billion) by 2030. according to the UN state of the world population 2007 report, the majority of people worldwide will be living in towns or cities, for the first time in history, this is referred to as the arrival of the “urban millennium” or the ‘tipping point’. In regard to future trends, it is estimated 93% of urban growth will occur in developing nations, with 80% of urban growth occurring in Asia and Africa

Urbanization simply defined, is the shift from a rural to an urban society and involves an increase in the number of people in urban areas during a particular year. Urbanization is the outcome of social, economic and political development that lead to urban concentration and growth of large cities changes in the land use and transformation from rural to metropolitan pattern of organization and governance.

Although Urbanization is the driving force for modernization, economic growth and development, there is increasing concern about the effect of expanding cities, particularly on human health, livelihood and environment. The implication of rapid urbanization and demographic trends for employment, food, security, water supply, shelter and sanitation, especially the disposal of waste (solid and liquid) that the cities produce are staggering (UNCED, 1992). The question that arises is whether the current trend in urban growth is sustainable considering the accompanying urban challenge such as unemployment, poverty and environmental degradation especially in the developing countries.

Thus, of significant attention to us is the problem of unemployment as a result of urbanization in the Nigerian urban areas. Urban unemployment or unemployment in the urban Nigeria stands for the conglomeration of people with diversity background, willing and able to work in the urban areas resulting in pressure of supply of labour over the demand for labour. Thus causing joblessness. Implicit in this definition are the following for excessive manpower supply of labour over manpower demand for labour, there may have a risen a situation whereby job seekers irrelevant or not needed education qualification, both the public and private sector may not have involved a calculated policy to afford them the opportunity for self employment through planned programs. In Nigeria it is estimated that in 1900 about 95% of Africa’s inhabitants South of Sahara lived from the Primary occupations of farming, hunting & gathering, cattle anomalism, and fishing (Aase, 2003:1) meaning that less than 5% were urban. In 1950 (the start of the independence period) 14.7% of Africa’s inhabitants were urban in 2000 had it risen to 37.2% and it is expect 3.76%, 3.35% per year (UN, 2002) the Nigerian city of Lagos in 1963 had 665000 inhabitants (Rakodi, 1991) and 8.7miliion in 2000 is expected to become the worlds 11th biggest city by 2015 with 16million inhabitants (UN, 2002).

Therefore, a survey by the UN international labour organization (ILO) indicated that as many as 3 million Nigerians fall within the working age out of this, 90 percent or about 3 million are unemployed. A further study on the geographical distribution of those unemployed shows that as many as 2.7million out of the 3 million live in urban area (ILO survey report African concord 1996).

Surely, it is very difficult to ascertain the current rate of unemployment in Nigeria but evidence and indication of urban unemployment overwhelming. There is no gainsaying that there are significant correlation between urbanization and unemployment in Nigeria though Urbanization is also a consequence of industrialization or economic specialization. It connotes the movement of people principally from agricultural productivity. The process involves changing relationship and interaction.

Conclusively, there exists convincing evidence that the bulk of urban unemployment in the country is among able bodied youths. Data shows that in 2009 at the recent Nigerian economic summit, group (NESG) policy dialogue on the Nigeria economy, Nigeria’s minister of finance quoted data from the National Bureau of statistics (NBS) saying that “unemployment in Nigeria is running at around

19.7 percent on average and almost half of 15-24 year olds living in urban areas are jobless” the theme of the policy dialogue growth through public private partnership.

1.2 STATEMENT OF THE PROBLEM

The Nigeria population of about 150 million with a growth rate of 3.2%, more youths are getting into the educational system, more

.youths are also graduating, more are getting into the urban labour market while more are also becoming unemployed. Some of the manifestation of the failing of both the educational system and the economy are unemployment and underemployment. Urban unemployment is growing progressively worse due to rural to urban migration. This migration is as a result of high concentration of Infrastructure and amenities in the urban areas, coupled with favourable living conditions and standard of living.

Some adolescents do not think about any job at all until they are faced with the issue of locating one in the urban center. The contributing fact to this is that career guidance is minimally emphasized in our school curriculum. When the youths are not formally provided with occupational information which forms the basis for realistic occupational choice, some often accept any job for which they are not well prepared for these result into inefficiency, low productivity, low or lack of job satisfaction and they all culminate into underdevelopment.

1.3 OBJECTIVES OF THE STUDY

The objectives of the study are:

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