Project – Youth Unemployment and Household Poverty in Nigeria: A Case Study of Surulere Local Government Area, Lagos State.

CHAPTER ONE

INTRODUCTION

TOPIC: YOUTH UNEMPLOYMENT AND HOUSEHOLD POVERTY IN NIGERIA: A CASE STUDY OF SURULERE LOCAL GOVERNMENT AREA, LAGOS STATE

1.1 Background to the Study

Youth unemployment has remained one of the major socioeconomic challenges confronting developing countries, particularly Nigeria, where a significant proportion of the population comprises young people who are economically active but unable to secure decent and sustainable employment. Employment is an important means through which individuals earn income, meet their basic needs, support their families and contribute to national economic development. When young people are unable to obtain employment opportunities, their ability to achieve economic independence becomes limited, thereby increasing their dependence on parents, guardians and other household members. Youth unemployment also reduces the productive capacity of society, contributes to income inequality and creates conditions that may encourage social exclusion, frustration and economic insecurity. The International Labour Organization (ILO, 2020) explained that youth employment is essential for inclusive economic growth because it enables young people to participate in productive activities and improve their living conditions. Similarly, the World Bank (2013) identified the creation of productive employment opportunities for young people as a major development priority, particularly in developing economies where population growth places increasing pressure on labour markets. In Nigeria, the challenge is particularly important because the economy has continued to experience difficulties in generating sufficient decent employment opportunities for the growing number of young people entering the labour market. Consequently, youth unemployment has become an issue that extends beyond individual joblessness to affect household welfare, poverty levels and the broader socioeconomic development of the country (ILO, 2020; World Bank, 2013).

Youth unemployment refers to a situation in which young people who are within the economically active age group, are available for work and are actively seeking employment are unable to secure jobs. The ILO generally adopts the age bracket of 15–24 years for international youth labour statistics, although national studies may adopt broader age classifications depending on their research objectives and national policy frameworks. Youth unemployment is influenced by several factors, including inadequate job creation, limited industrial development, skills mismatch, poor educational-to-employment transition, insufficient access to capital and unfavourable economic conditions. In many developing countries, the number of young people entering the labour market increases faster than the number of available formal employment opportunities. This situation creates intense competition for limited vacancies and leaves many graduates and school leavers without stable sources of income. The International Labour Organization (2022), in its Global Employment Trends for Youth report, highlighted the continuing difficulties young people face in accessing decent employment, particularly in developing economies where informal employment and insecure working conditions are widespread. The World Bank (2019) also identified the importance of human capital development, relevant skills and productive employment in improving the economic prospects of young people. In Nigeria, these issues are reflected in the difficulties many young people encounter when attempting to secure employment that corresponds with their educational qualifications and professional abilities. Therefore, youth unemployment should be understood not only as the absence of jobs but also as a broader challenge involving the availability, accessibility, quality and sustainability of employment opportunities (ILO, 2022; World Bank, 2019).

The relationship between youth unemployment and household poverty is particularly important because households depend on the income and productive contributions of their members to meet essential needs such as food, housing, education, healthcare, transportation and other daily expenses. In households where young people are expected to contribute financially, their inability to secure employment may increase the economic burden on parents, guardians and other working household members. This may reduce household disposable income and make it difficult for families to maintain acceptable living standards. Furthermore, unemployed young people may remain financially dependent on household heads for extended periods, thereby increasing the number of dependants supported by limited household resources. The World Bank (2018) explained that poverty is multidimensional and involves not only inadequate income but also deprivation in access to education, healthcare, basic services and opportunities. Similarly, the United Nations Development Programme (UNDP, 2022) emphasised that poverty is associated with multiple forms of deprivation that restrict people’s ability to achieve acceptable standards of living. These perspectives demonstrate that the consequences of youth unemployment may extend beyond the unemployed individual to affect the welfare and development opportunities of other household members. Therefore, understanding household poverty requires examining the employment conditions of different household members, particularly young people whose productive contributions could improve household income and economic security (World Bank, 2018; UNDP, 2022).

In Nigeria, youth unemployment has been influenced by structural weaknesses in the economy, including inadequate industrial expansion, limited private-sector job creation, inconsistent economic policies, infrastructure deficits and the mismatch between educational training and labour market requirements. Although the country has a large population of educated young people, educational qualifications do not always translate into employment opportunities because the economy has not consistently generated sufficient productive jobs to absorb new entrants into the labour market. In addition, some young people lack the technical, entrepreneurial and digital skills required by employers, while others encounter difficulties accessing the financial resources needed to establish their own businesses. The National Bureau of Statistics (NBS, 2020), in its labour force report, documented the employment and unemployment challenges facing Nigeria, although subsequent changes in labour force measurement mean that unemployment rates from different reporting periods must be interpreted carefully. The ILO (2022) also observed that the transition from education to employment remains difficult for many young people, particularly in economies characterised by limited decent work opportunities. Furthermore, the World Bank (2022) identified weak economic growth, inflationary pressures and limited productive opportunities as factors affecting household welfare in Nigeria. These conditions have created an environment in which many young people struggle to achieve financial independence, while their households experience increased pressure to provide financial and material support. Thus, the persistence of youth unemployment represents an important concern for poverty reduction and socioeconomic development in Nigeria (NBS, 2020; ILO, 2022; World Bank, 2022).

Household poverty in Nigeria is also closely connected to the rising cost of living, declining purchasing power and the limited capacity of many households to generate sufficient income to meet their basic needs. A household may experience poverty when its available income and resources are inadequate to provide essential goods and services for its members. Youth unemployment can intensify this situation because unemployed young people are unable to contribute regularly to household income and may depend on the earnings of parents, guardians or other relatives. In some circumstances, the financial pressure associated with supporting unemployed youths may compel households to reduce expenditure on education, healthcare, nutrition and other essential services. This can create a cycle in which poverty limits access to opportunities, while the absence of employment opportunities further reinforces household poverty. The National Bureau of Statistics (NBS, 2022), in its Nigeria Multidimensional Poverty Index Report, estimated that 133 million Nigerians were multidimensionally poor, representing 63% of the population at the time of the survey. The report identified deprivations in health, education, living standards and work-related conditions as important dimensions of poverty. Similarly, the World Bank (2022) observed that economic difficulties and high living costs had placed considerable pressure on Nigerian households. These findings highlight the importance of examining youth unemployment as a factor that may contribute to household poverty, particularly where unemployed young people remain dependent on limited family resources (NBS, 2022; World Bank, 2022).

Lagos State provides an important context for examining the relationship between youth unemployment and household poverty because it is one of Nigeria’s major commercial, industrial and financial centres. The state attracts young people from different parts of the country in search of employment, educational opportunities and improved living conditions. Its economy includes manufacturing, banking, transportation, wholesale and retail trade, hospitality, construction, information technology and numerous informal economic activities. Despite these opportunities, the concentration of job seekers in Lagos creates considerable competition for available employment, particularly among young graduates, school leavers and individuals without specialised skills. In addition, the high cost of accommodation, transportation, food, healthcare and other essential services can make it difficult for unemployed young people and low-income households to maintain acceptable living standards. The Lagos State Government (2022), through its development planning and employment-related policy initiatives, recognised the importance of skills development, entrepreneurship and job creation in improving the economic welfare of residents. The World Bank (2022) also identified urban economic pressures, inflation and limited income opportunities as important factors influencing household welfare in Nigeria. These conditions make Lagos State a relevant environment for investigating how the inability of young people to secure employment may affect household income, financial responsibilities and the general standard of living of family members (Lagos State Government, 2022; World Bank, 2022).

Surulere Local Government Area is an important urban area within Lagos State, characterised by residential neighbourhoods, commercial activities, small businesses, educational institutions, markets and different categories of informal and formal employment. The socioeconomic activities within Surulere provide livelihood opportunities for residents through trading, transportation, artisanship, hospitality, professional services, retail businesses and other entrepreneurial activities. However, the existence of these economic activities does not necessarily guarantee that every young person will secure decent and sustainable employment. Some young people may experience prolonged job searches, underemployment, irregular income and dependence on family members, while others may engage in low-paying informal activities that cannot provide sufficient financial support for themselves or their households. For households with limited income, the inability of young members to secure stable employment may increase financial responsibilities and make it difficult to meet basic needs. The National Bureau of Statistics (NBS, 2022) demonstrated through its multidimensional poverty assessment that poverty in Nigeria involves interconnected disadvantages in living standards, education, health and employment-related opportunities. Similarly, the World Bank (2018) emphasised that poverty reduction requires improving people’s access to productive opportunities and strengthening their capacity to generate sustainable income. Although these national findings provide an important understanding of the wider poverty situation, there is a need to examine how youth unemployment manifests within the particular socioeconomic circumstances of households in Surulere. Such an investigation will provide a better understanding of the relationship between young people’s employment status and the economic welfare of their households (NBS, 2022; World Bank, 2018).

Despite government interventions and various employment initiatives aimed at promoting entrepreneurship, vocational training, skills acquisition and youth empowerment, youth unemployment and household poverty remain important development concerns in Nigeria. The challenges are particularly significant where available employment opportunities are inadequate, vocational skills do not correspond with labour market demands and young people lack access to the financial resources required to establish sustainable businesses. Moreover, even when young people obtain employment, low wages, irregular earnings and insecure working conditions may limit their ability to contribute meaningfully to household welfare. This indicates that the relationship between youth unemployment and household poverty should be examined beyond the simple distinction between employed and unemployed individuals. It is also necessary to consider the extent to which unemployment affects household income, access to basic necessities, educational opportunities and the general standard of living. The ILO (2022) stressed the importance of decent employment in improving young people’s economic security, while the NBS (2022) demonstrated that poverty in Nigeria is multidimensional and extends beyond inadequate income. Against this background, the study seeks to examine youth unemployment and household poverty in Nigeria, using Surulere Local Government Area of Lagos State as a case study. The study will specifically investigate how youth unemployment affects household income, access to basic needs, financial dependency and the general welfare of households in the study area (ILO, 2022; NBS, 2022; World Bank, 2018).

1.2 Statement of the Problem

Youth unemployment has continued to pose a serious challenge to socioeconomic development in Nigeria, particularly because of the difficulty of creating sufficient productive employment opportunities for the growing population of young people. Every year, thousands of young Nigerians complete secondary and tertiary education and enter the labour market in search of employment. However, the available employment opportunities are often insufficient to accommodate the increasing number of job seekers. Consequently, many young people remain unemployed for extended periods, while others engage in temporary, irregular or poorly paid activities that cannot provide adequate financial security. This situation has implications for household welfare because families are often required to provide financial support for unemployed young people who would otherwise have been expected to contribute to household income. Although the National Bureau of Statistics (NBS, 2024) reported a youth unemployment rate of 8.4% among persons aged 15–24 years in the first quarter of 2024, the broader problem also includes underemployment, informal work and young people who are neither in employment, education nor training. The ILO (2022) similarly highlighted the difficulties young people encounter in securing decent and sustainable employment. The persistence of these challenges raises concerns about the capacity of households to maintain adequate living standards when their economically active young members cannot secure reliable sources of income.

Another problem associated with youth unemployment is its potential contribution to household poverty through reduced income, increased financial dependency and the inability of families to meet their basic needs. In many Nigerian households, young people are expected to contribute financially to family welfare after completing their education or acquiring vocational skills. However, when they remain unemployed, the responsibility of providing food, accommodation, healthcare, transportation and other necessities continues to fall on parents, guardians and other working household members. This may increase the financial burden on household heads, particularly those who already earn low or irregular incomes. In extreme situations, families may be compelled to reduce expenditure on children’s education, healthcare, nutrition and other essential services to accommodate the needs of unemployed household members. The NBS (2022) reported that approximately 133 million Nigerians were multidimensionally poor, representing 63% of the population at the time of the survey. The report demonstrated that poverty involves interconnected deprivations in health, education, living standards and work-related conditions. This suggests that the effects of youth unemployment may extend beyond the loss of individual income to influence the general welfare and development opportunities of entire households. Nevertheless, the extent to which youth unemployment contributes to household poverty in Surulere requires specific investigation rather than relying exclusively on national poverty estimates.

Furthermore, youth unemployment may contribute to household poverty by limiting the ability of families to accumulate savings, invest in productive activities and improve their economic circumstances. Households that continuously support unemployed young people may have fewer resources available for business investment, property acquisition, children’s education and other income-generating activities. This situation can create a cycle of financial dependency in which unemployed youths remain dependent on household heads, while the household’s limited resources reduce its ability to provide the financial assistance, training and business capital that could help them become economically independent. The problem may also become more complicated where unemployed young people possess educational qualifications but lack the practical skills, work experience or financial resources required to establish sustainable livelihoods. The World Bank (2013) emphasised that employment is an important pathway through which individuals and households can improve their economic welfare and escape poverty. Similarly, the UNDP (2022) explained that multidimensional poverty reflects disadvantages that affect people’s ability to access essential opportunities and achieve acceptable living conditions. Despite the recognition of employment as an important poverty-reduction mechanism, the continued inability of many young people to obtain sustainable work raises questions about the extent to which unemployment contributes to household financial vulnerability in urban communities such as Surulere.

The problem is particularly relevant to Surulere Local Government Area of Lagos State, where residents participate in different economic activities, including trading, transportation, artisanship, hospitality, manufacturing, professional services and other informal business activities. Although these activities provide opportunities for employment and self-employment, not every young person possesses the skills, financial resources, business connections or experience required to benefit from them. Some young people may remain unemployed despite possessing educational qualifications, while others may accept low-paying or irregular jobs that provide insufficient income to support themselves or contribute meaningfully to household welfare. At the same time, the cost of living in an urban environment places considerable pressure on households, particularly those with limited and unstable sources of income. The NBS (2022) identified significant multidimensional poverty across Nigeria, while the ILO (2024) emphasised the continuing need to improve the quality and accessibility of employment opportunities for young people. However, national statistics and broader labour market assessments do not sufficiently explain the specific experiences of households in Surulere. The central problem, therefore, is the limited understanding of how youth unemployment affects household income, financial dependency, access to basic necessities and general living standards among residents of Surulere Local Government Area. This study seeks to address this problem by examining the relationship between youth unemployment and household poverty in the study area.

1.3 Objectives of the Study

The main objective of this study is to examine the relationship between youth unemployment and household poverty in Nigeria, using Surulere Local Government Area of Lagos State as a case study.

The specific objectives are to:

1. Examine the effect of youth unemployment on household income in Surulere Local Government Area.

2. Determine the influence of youth unemployment on household access to basic necessities such as food, healthcare and education in Surulere Local Government Area.

3. Assess the relationship between youth unemployment and financial dependency among households in Surulere Local Government Area.

4. Examine the effect of youth unemployment on the general standard of living of households in Surulere Local Government Area.

1.4 Research Questions

The following research questions will guide the study:

1. What is the effect of youth unemployment on household income in Surulere Local Government Area?

2. How does youth unemployment influence household access to basic necessities such as food, healthcare and education in Surulere Local Government Area?

3. What is the relationship between youth unemployment and financial dependency among households in Surulere Local Government Area?

4. To what extent does youth unemployment affect the general standard of living of households in Surulere Local Government Area?

1.5 Research Hypothesis

The following null hypothesis will be tested at a 0.05 level of significance:

H₀: There is no significant relationship between youth unemployment and household poverty in Surulere Local Government Area of Lagos State.

1.6 Significance of the Study

This study will be significant to government, policymakers, unemployed youths, household heads, educational institutions, development organisations, researchers and the general public.

Government and Policymakers: The study will provide useful information on the relationship between youth unemployment and household poverty. Its findings will assist government at federal, state and local government levels in understanding how unemployment affects household economic welfare. It may also guide the formulation of policies and programmes aimed at promoting employment generation, entrepreneurship development, vocational training and poverty reduction.

Unemployed Youths: The study will create awareness of the economic consequences of unemployment and the importance of acquiring relevant skills that correspond with labour market requirements. It may encourage young people to explore vocational training, entrepreneurship, digital employment and other legitimate income-generating opportunities.

Household Heads and Parents: The study will help household heads understand how youth unemployment affects household income, financial responsibilities and living standards. It will also provide useful insights into the importance of supporting young people through education, skills development and productive economic activities.

Educational Institutions: The findings may help educational institutions understand the relationship between educational preparation and employment opportunities. The study may encourage schools and tertiary institutions to strengthen practical training, entrepreneurship education and vocational programmes that improve the employability of young people.

Development Organisations and NGOs: Non-governmental organisations and development agencies may benefit from the findings when designing programmes aimed at youth empowerment, poverty reduction, skills acquisition and household economic development.

Researchers and Students: The study will contribute to existing literature on youth unemployment and household poverty in Nigeria. It will serve as a reference material for students and researchers undertaking further studies on unemployment, poverty, economic dependency and socioeconomic development.

The General Public: The study will increase public understanding of the consequences of youth unemployment for families and communities. It may also encourage collective support for initiatives that promote decent employment, entrepreneurship and sustainable household welfare.

1.7 Scope of the Study

The study focuses on youth unemployment and household poverty in Nigeria, using Surulere Local Government Area of Lagos State as its geographical case study.

Geographical Scope: The study will be restricted to Surulere Local Government Area of Lagos State. The area is selected because of its urban characteristics and the presence of different socioeconomic and commercial activities that provide a relevant setting for examining youth unemployment and household welfare.

Content Scope: The study will examine youth unemployment as the independent variable and household poverty as the dependent variable. Specifically, it will investigate the effect of youth unemployment on household income, access to basic necessities, financial dependency and general standard of living.

Population Scope: The study will focus on selected households and young people within the study area. For the purpose of the research, youth will be defined according to the age bracket adopted by the study, preferably 15–35 years in line with Nigeria’s National Youth Policy (2019). The international ILO statistical age classification of 15–24 years will be acknowledged when discussing internationally comparable youth unemployment statistics.

Time Scope: The study will consider the contemporary experiences of youth unemployment and household poverty, using relevant recent information and evidence to explain the socioeconomic conditions of the study area.

1.8 Operational Definition of Terms

Youth: Young individuals within the age bracket of 15–35 years, as adopted for this study in accordance with Nigeria’s National Youth Policy (2019).

Youth Unemployment: A situation in which young people who are available for work and actively seeking employment are unable to secure suitable jobs or employment opportunities.

Household: A person or group of persons who live together and make common arrangements for food and other basic domestic needs.

Household Poverty: A condition in which a household lacks sufficient income and resources to meet the essential needs of its members, including food, shelter, healthcare, education and other basic necessities.

Household Income: The total financial earnings received by members of a household from employment, business activities, investments and other legitimate sources within a specified period.

Financial Dependency: A situation in which an individual relies on another person, particularly a household member, for financial support and the provision of basic needs.

Standard of Living: The general level of economic and material welfare enjoyed by individuals or households, measured through access to food, housing, education, healthcare, transportation and other essential services.

Basic Necessities: Essential goods and services required for human survival and acceptable living conditions, including food, clothing, shelter, healthcare and education.

Employment: Any legitimate economic activity through which an individual engages in productive work and receives financial or other economic returns.

Project – Youth Unemployment and Household Poverty in Nigeria: A Case Study of Surulere Local Government Area, Lagos State.