- Food prices, inflation at 11-year high
- 4.58m Nigerians became jobless in Q1, Q2 2016
NATIONAL Bureau of Statistics, NBS, has confirmed that Nigeria is in its worst economic recession in 29 years. According to the NBS Gross Domestic Product, GDP, report for the second quarter of 2016, Nigeria’s economy contracted by 2.06 percent to record its lowest growth rate in three decades. In the first quarter of 2016, the NBS said the economy shrank by 0.36 percent to hit its lowest point in 25 years. According to World Bank data, the last time Nigeria had this magnitude of economic decline was under the regime of Ibrahim Babangida, when the economy recorded consecutive decline of 0.51 percent and 0.82 percent in first and second quarters of 1987. “In the second quarter of 2016, the nation’s Gross Domestic Product, GDP, declined by -2.06 percent (year-on-year) in real terms,” the NBS revealed. “This was lower by 1.70 percent points from the growth rate of –0.36 percent recorded in the preceding quarter, and also lower by 4.41 percent points from the growth rate of 2.35 percent recorded in the corresponding quarter of 2015. “Quarter on quarter, real GDP increased by 0.82 percent during the quarter, nominal GDP was N23,483,954.78 (in nominal terms) at basic prices. This was 2.73 percent higher than the Second Quarter 2015 value of N22,859,153.01. This growth was lower than the rate recorded in the Second Quarter of 2015 by 2.44 percent points.” Oil down, agriculture up The oil sector experienced a decline of 17.48 percent while the agricultural sector grew by 13.24 percent within the quarter, the NBS further revealed. With the mining sector shrinking by 47.9 percent and manufacturing falling by 1.02 percent, the general non-oil sector declined by 0.38 percent. On the bright side, the “public administration sector grew by 8.21 percent in the second quarter of 2016, higher by 10.86 percent points from the corresponding quarter of 2015 and higher by 1.83 percent points relative to the First Quarter of 2016.” The International Monetary Fund, IMF, had initially predicted that the Nigerian economy would shrink by 1.8 percent in 2016. With the current results from the NBS, Nigeria is beating the IMF set bar at an aggregate GDP of 1.21 percent. Food prices rise as inflation steadies at 11- year high Consumer Price Index, CPI, which measures inflation, rose by 0.6 percent in July to stay steady within its 11-year record attained in June 2016. According to NBS, food prices increased at a slower pace than in previous months of the year 2016. “In July, the Consumer Price Index, CPI, which measures inflation increased by 17.1 percent (year-on-year), 0.6 percent points higher from the rate recorded in June (16.5 percent),” NBS said in its monthly CPI report released on Wednesday. “The pace of the increase in the headline index was however weighed upon by a slower increase in three divisions; Health, Transport, and Recreation & Culture divisions. “The onset of the harvest season is yet to have a significant impact on food prices as the Food Sub-index increased by 15.8 percent (year-on-year) in July, 0.5 percent points lower from rates recorded in June. “Prices, however, increased at a slower pace across a few groups within the Food sub-index namely Milk, Cheese and Eggs; Oils and Fats; and Fruits. In addition, imported foods as reflected by the Imported Food Sub-index increased by 0.4 percent points from June to 20.5 percent in July.” Energy prices were responsible for a rise in inflation recorded in July, the NBS added. “Energy and energy related prices continue to be the largest increases reflected in the Core sub-index. In July, the Core sub-index increased by 16.9 percent during the month, up by 0.7 percent points from rates recorded in June (16.2 percent). “During the month, the highest increases were seen in the Electricity, Liquid Fuel (kerosene), Solid Fuels, and ‘Fuels and Lubricants for Personal Transport Equipment’ groups. Month-on-month, the Headline index increased albeit, at a slower pace for the second consecutive month in July. The index increased by 1.3 percent in July, 0.4 percent points from 1.7 percent recorded in June.” 4.58m Nigerians became jobless in Q1, Q2 of 2016 The NBS also stated that the total number of Nigerians who became unemployed within the first and second quarter of 2016 now stands at 2.6 million. According to the bureau, about 1.46 million Nigerians became unemployed in the third quarter of 2015 while another 518,102 became unemployed in the fourth quarter of 2015. This brings the total freshly unemployed persons in the economy to a record high of 4,580,602, since President Muhammadu Buhari took office in May 2015. In its second quarter, unemployment and underemployment report released on Wednesday, NBS said the country’s unemployment rate grew from 12.1 percent in the first quarter of 2016 to a record high of 13.3 percent in the second. “During the reference period, the number of unemployed in the labour force increased by 1,158,700 persons, resulting in an increase in the national unemployment rate to 13.3 percent in Q2 2016 from 12.1 in Q1 2016, 10.4 percent in Q4 2015 from 9.9 percent in Q3 2015 and from 8.2 percent in Q2 2015,” NBS said. “In view of this, there were a total of 26.06 million persons in the Nigerian labour force in Q2 2016 that were either unemployed or underemployed, compared to 24.5 million in Q1 2016 and 22.6 million in Q4 2015.” The economically active population or working age population (persons within ages 15- 64) increased from 106 million in Q1 2016 to 106.69 million in Q2 2016, the report added.
Underemployment in the economy was also on the rise, with 15.4 million Nigerians said to be underemployed. “The number of underemployed in the labour force (those working but doing menial jobs not commensurate with their qualifications or those not engaged in full- time work and merely working for few hours) increased by 392,390 or 2.61 percent, resulting in an increase in the underemployment rate to 19.3 percent (15.4million persons) in Q2 2016 from 19.1 percent (15,02 million persons) in Q1 2016, 18.7 percent (14.42 million persons) in Q4 2015, from 17.4 percent (13.2 million persons) in Q3 2015 and 18.3 percent (13.5 million persons) in Q2 2015.” There were a total of 26.06 million persons in the Nigerian labour force in Q2 2016 that were either unemployed or underemployed, compared to 24.5 million in Q1 2016 and 22.6 million in Q4 2015.