Decades After Creation: NDE fails to rescue nation from mass unemployment

• Joblessness spirals from 5.3% to 33% in 37 years
• Agency spends n46b on 750, 525 participants in special public works scheme
• Additional n5.6b goes for hoes, cutlasses
• ‘Nation’s lending framework killing bankable business plans’
• How to make NDE impactful – experts

Despite the creation of the National Directorate of Employment (NDE) 37 years ago by the Federal Government to provide alternatives to white-collar jobs, the unemployment situation in the country has become worse over the years.

Stakeholders expressed worry that in spite of billions of naira already spent on the agency’s programmes, the country’s unemployment rate has continued to soar, skyrocketing from a single digit 5.3 per cent at the time of establishment of the NDE to 33 per cent now.

The NDE was set up in 1986 during the regime of former military President, Gen. Ibrahim Babangida to promote job creation, employment opportunities, and skills development across the country. Its primary goal is to reduce poverty and enhance economic growth by providing Nigerians with the skills and opportunities needed for gainful employment.

Indeed, the national unemployment figure as of 1986 stood at 5.3 per cent. While the urban unemployment rate was 9.1 per cent, the rural unemployment figure was 4.6 per cent.

Though the NDE has implemented various programmes and initiatives over the years to combat unemployment and underemployment through vocational trainings, apprenticeship schemes, and public works, but they appear not to have impact on the nation’s unemployment status.

A development and finance expert and Chief Executive at Dairy Hills Limited, Kelvin Emmanuel, said the most important thing when it comes to job creation is access to credit, and until the government develops a mechanism for de-risking the discovery process for assessment, reducing unemployment on a significant scale will remain a mirage.

Assessing the effectiveness of the NDE through the times, development enthusiasts and stakeholders said it was clear that the directorate’s programmes have not reached all unemployed Nigerians, indicating limited number of beneficiaries compared to the overall unemployment rate in the country.

Concerns were also raised about accountability of the agency in the implementation of some of its initiatives through the years. For instance, the public works programme that was introduced by Festus Keyamo, when he was the Minister of State for Labour, to cushion the effects of the COVID-19 pandemic on vulnerable groups, which reportedly gulped N40 billion, remains a project in which the NDE is yet to provide enough accountability, as the leading implementing agency.

Under the Special Public Works Programme in the Rural Areas initiative, which was approved by former President Muhammadu Buhari in 2019, the government planned to engage 774, 000 skilled and unskilled youths in executing public works projects across the country.

The stakeholders also argued that the impact of the NDE could have been more sustainable if there were stronger links between the skills acquired and the demands of the labour market, as well as support for entrepreneurs. They noted that the ability of the Directorate to ensure accountability and sustain the long-term impact of its programmes could be challenging, hence the need for robust monitoring and evaluation mechanisms.

The NDE offers training programmes to equip individuals with various vocational skills such as tailoring, carpentry, welding, and computer literacy. The skills are designed to make participants more employable or enable them to start their businesses.
The agency’s Youth Empowerment Scheme (YES) focuses on empowering young Nigerians by providing training and financial support for entrepreneurship. It aims to create a new generation of self-employed individuals who can start and run their businesses.

The Special Public Works (SPW) scheme, on which over N40 billion was expended by Keyamo, involves engaging unemployed Nigerians in short-term public works. Participants are typically involved in activities like road maintenance, sanitation, and community development, which fetch them temporary income.

The Rural Employment Promotion initiative aims to create job opportunities in rural areas by supporting agricultural and agribusiness ventures. It includes training in agricultural practices and providing access to resources. The Microenterprise Enhancement Scheme (MEES) focuses on helping microenterprises grow and expand. It provides support in the form of training, access to credit, and business development services.

The Community-Based Targeting (CBT) programme is reported to target vulnerable and marginalised groups, including people with disabilities and women, to provide them with training and opportunities for self-employment, while its Environmental Beautification and Sanitation Corps (EBSC) engages young people in environmental cleanup and beautification projects, providing them with employment opportunities.

In the Agri-Business and Small and Medium Enterprises Investment Scheme (AGSMEIS), the NDE collaborates with financial institutions to facilitate access to affordable loans and financial services for entrepreneurs in the agricultural and SME sectors.

The Directorate also has Skills Acquisition and Empowerment Program (SAEP) and Enterprise Development and Promotion, which provide support for the establishment and growth of small and medium-sized enterprises (SMEs) through training, access to credit, and business development services.

Stakeholders expressed divergent views on the effectiveness of the NDE. Some believe that the NDE has been successful in providing vocational training and employment opportunities to many Nigerians, especially youth and women.

According to them, through initiatives like the Special Public Works, the NDE has contributed to poverty reduction by providing temporary income for unemployed individuals, particularly in rural areas. They admitted that there have been challenges hampering the agency’s effectiveness.

Under President Muhammadu Buhari in 2019, the government planned to engage 774, 000 skilled and unskilled youths in executing public works projects across the country. In line with Section 16 (1) of the NDE Act, a special committee was to be set up in each state of the federation to deliberate, select and recommend1000 persons from each of the local councils to be engaged for the programme.

According to the ‘SPW final implementation report’ submitted to Buhari, which was exclusively obtained in Abuja, yesterday, the NDE said as of June 6, 2022, “the sum of N45, 937, 140, 000 has been paid out to a total of 765, 619 participants nationwide as three months stipends, though 6,463 names out of the said number were double-paid. As such, 759,156 participants will reflect as actual payments after the reversal of funds by the commercial banks concerned. This represents 98.1 per cent of the ESPW registered participants and 99.8 per cent of the verified and engaged figure.”

The report also noted that N5, 565,767, 535.13 was used for logistics such as hoes and cutlasses at the rate of N7, 190, 914.13 per local council.
To the Chief Executive Officer, Dairy Hills Limited, Emmanuel, one of the challenges of creating employment in the country is the lack of realization by the government that the informal economy constitutes 82 per cent of the working population.

He argued that the rising interest rates, as well as the collateral-based lending framework in the financial architecture of the economy, has locked out millions of sound bankable business plans from access to capital, with banks preferring to pay fines in place of giving out credit without securitization. This is because most financial institutions believe that the return of principal is greater than the return on principal, and it is better to keep their money in treasury operations than for it to become bad debt, that has to be provisioned for losses.

“Other than the lack of well-developed infrastructure and a low ease of doing business mechanism, for which Nigeria scored 131 out of 190 in 2022, the new government has a task of integrating the BVN with the NIN, to develop a credit rating model on which financial institutions can derive a risk mechanism for assessing and making informed decisions for credit, especially to MSMEs,” he advised.

A development worker, Halilu Mohammed, decried what he called proliferation of job-creating agencies under different governments, which has led to inefficiency and massive corruption.

He stated: “If you critically examine the activities of the NDE since its creation, it has achieved so little. After spending billions, if not trillions, on its activities, unemployment has grown geometrically over the years. While this may not be the singular fault of the NDE, different governments created other quasi-ministries for the sole purpose of job creation, which turned out to be conduit pipes through which government funds were siphoned. How can anyone justify spending over N60 billion on public works programme where people were given hoes, cutlasses and stipends as antidotes against joblessness? For me, that is another government magic.”