Impact of Unemployment on National Output in Nigeria, 1980-2011

Abstract

Unemployment has been identified as one of the major factors responsible for the prevailing high level of poverty, inequality and sluggish economic growth in Nigeria. It thus becomes a problem that requires thorough examination. This study therefore examines the impact of unemployment on national output in Nigeria between the period 1980 and 2011. The study makes use of secondary time series data sourced from the publications of the Central Bank of Nigeria, National Bureau of Statistics and other similar organizations. The Engle Granger co-integration approach was used to investigate the long-run relationship between unemployment and the growth of the Nigerian economy.  Prior to the co-integration test, the incorporated time series variables were examined using the Augmented Dickey-Fuller (ADF) unit-root test. The estimated regression results shows that unemployment and Gross domestic product show a negative statistically insignificant relationship implying that in Nigeria, unemployment and Gross domestic product did not affect each other for the period under study. Appropriate recommendations were offerred based  on the findings.

Keywords: Unemployment, Investment, Money supply, Economic growth.

JEL Classification: E24, O11, O47