Effect of Non-Oil Exports on Unemployment Rate in Nigeria
DOI:
https://doi.org/10.64348/zije.2026407Abstract
Nigeria is experiencing persistent increase in unemployment accompanied by slow economic growth despite abundant non-oil export goods in Nigeria. This study investigated the effect of non-oil export goods on unemployment through economic growth in Nigeria from 1986-2025. Unemployment rate was used as the dependent variable while the components of non-oil-exports (agricultural, manufacturing, solid mineral, and services exports) were employed as independent variables. Data were obtained from the Central Bank of Nigeria (CBN), National Bureau of Statistics (NBS), and World Development Indicators (WDI). The study utilized ex post facto quantitative research design. Augmented Dickey-Fuller (ADF) and Phillip Pearons (PP) unit root tests were conducted and the results showed that the data were stationary at first difference. Johansen Cointegration test was carried out and the result revealed the existence of long-run relationship between the variables. The estimated Vector Error Correction Model (VECM) results showed that RGDP had a positive (0.004688) and statistically significant impact on unemployment in the short-run and likewise a positive (0.002701) and statistically significant impact on unemployment in the long-run. Agricultural exports (AGEX) impacted positively (0.000646) on unemployment in the short-run although statistically insignificant but in the long-run it had a positive (0.003502) and statistically significant impact on unemployment. Manufacturing exports (MAEX) both in the short-run and long-run had positive (0.008147) and (0.005935) statistically significant impact on unemployment respectively. Also, solid mineral exports (SMEX) had a negative (-0.144854) and statistically significant impact on unemployment in the long-run. It did not meet the a priori expectation of positive sign. More so, services exports (SREX) in the short-run impacted negatively (-0.019047) on unemployment and statistically significant. The error correction term was negative (-0.626510) and correctly signed. It suggested that the speed of adjustment from short-run to long-run equilibrium will be corrected by 63%. The study concluded that non-oil exports (agricultural exports, manufacturing exports, and solid mineral exports) except services exports had significant transmission effect on unemployment through economic growth in Nigeria during the period under review. The study recommended that the positive and significant transmission effect of the non-oil exports on unemployment through economic growth in Nigeria should be maintained and sustained by the Nigerian government. This can be achieved through investing in agricultural technology, improving market access, and providing subsidies, credit facilities, and insurance to farmers. Also, encouraging production of value-added goods to increase exports and revenue, and by sanctioning illegal mining activities in Nigeria.
References
Abogan, O. P., Akinola, E. P., & Baruwa, O. I. (2014). Non-oil export and economic growth in Nigeria (1980-2011). Journal of Research in Economics and International Finance, 3(1), 1-11.
Adeniyi, A. (2021). Manufacturing exports and employment in Nigeria. International Journal of Finance and Banking Studies, 10(2), 111-119. DOI: https://doi.org/10.20525/ijfbs.v10i2.1274
Ahmed, H. A. (2022). Overview of Nigeria’s solid mineral potentials, challenges and prospects. Journal of the Environment, 16(1), 76-91.
Ajakaiye, O., & Ojowu, O. (2014). Exchange rate depreciation and the structure of sectorial prices in Nigeria under an alternative pricing regime (1986-1989). AERC Research Paper, No. 25, Nairobi: African Economic Consortium.
Akeem, U. O. (2011). Non-oil export determinants and economic growth in Nigeria. European Journal of Business and Management, 3(3), 236-257.
Akpan, J. I., & Obayori, J. B. (2022). Non-oil exports financing: An implication for economic growth. European Journal of Accounting and Investment, 8(9), 1-12.
Alrakhman, D., Susetyo, D., & Azwardi, T. (2022). Effect of economic growth on unemployment rate in Indonesia. Budapest International Research and Critics Institute-Journal (BIRCI-Journal, 5(2), 1014-1032.
Aniobi, S. C., & Adedokun, J. O. (2021). Economy beyond oil: Harnessing Nigerian solid-mineral deposits for sustainable development. International Journal of Academic Accounting, Finance and Management, 5(8), 24-31.
Asogwa, J. O., Okechukwu, E. U., & Oyekwelu, U. L. (2018). Evaluation of the effect of federal government external debts and reserves on economic growth in Nigeria. Journal of Economics and Sustainable Development, 9(6), 1-16.
Briggs, D. T., Nteegah, A., & Ohale, L. (2022). Does international trade reduce unemployment? Empirical evidence from Nigeria. Asian Journal of Economics, Finance and Management 4(1), 462-481.
Central Bank of Nigeria (2020). Annual Statistical Bulletin. CBN Publications, Abuja, Nigeria.
Central Bank of Nigeria (2023). Annual Statistical Bulletin. CBN Publications, Abuja, Nigeria.
Central Bank of Nigeria (2025). Central Bank of Nigeria Annual Report, Abuja, Nigeria.
Conteh, K. (2021). Economic growth and unemployment: An empirical assessment of Okun’s law in the case of Liberia. (6), 1-13. DOI: https://doi.org/10.20944/preprints202105.0759.v2
Dickey, D. A., & Fuller, W. A. (1981). Likelihood ratio statistics for autoregressive time Series with a unit root. Econometrica, 4(2), 1057-1072. DOI: https://doi.org/10.2307/1912517
Ebere, C. E., Ajibola, J. O., & Onakoya (2022). Agriculture and employment creation: Evidence from Nigeria. Euro Economica, 2(42), 58-66.
Gyimah-Brempong, K., & Baah-Boateng, W. (2021). Service exports and youth unemployment in Africa. Journal of African development, 22(1), 166-196. DOI: https://doi.org/10.5325/jafrideve.22.1.0166
Haller, S. A. (2012). Intra-firm trade, exporting and firm performance. Canadian Journal of Economics, 45(4), 1397-1430. DOI: https://doi.org/10.1111/j.1540-5982.2012.01736.x
Ideh, A. O., Okolo, N. M.., & Emengini, E. S. (2020). Non-oil sector and economic growth in Nigeria: The national accounts perspective. European Journal of Sustainable Development, 10(1) 185-202. DOI: https://doi.org/10.14207/ejsd.2021.v10n1p185
Isaiah, Z. T., Henneberry, S. R., & Radmehr, R. (2020). Effects of agricultural, manufacturing, and mineral exports on Angola’s economic growth. Energies, 13(6), 1494. DOI: https://doi.org/10.3390/en13061494
Jhingan, M. L. (2003). Macroeconomic theory, New Delhi: Vrinda publishers' Ltd.
John, C. (2022). Economic Growth. Encyclopaedia Britannica, 4 Oct. 2018.
Keynes, J. M. (1936). The General Theory of Employment, Interest and Money. Paperbound ed. London and Basingstoke: Macmillan.
Kindelberger, C. P. (1962). Foreign Trade and the National Economy: Yale University Press.
National Bureau of Statistics (2018). Unemployment/underemployment watch Q3. NBS, Abuja.
National Bureau of Statistics (NBS, 2025). Annual Abstract of Statistics, 6(2). 47-62.
Okoli, C. L; Ezenekwe, R., Geraldine., N., & Collins, U. (2023). Impact of non-oil export on economic growth in Nigeria. Journal of International Economic Relations and Development Economics, 2(1). 44-63.
Olaniyi, O., Ali, M., & Moses, A. B. (2021). A review of the unemployment-economic growth nexus in Nigeria from 1980-2015: A disaggregated approach. Asian Growth journal, 8(1), 48-56. DOI: https://doi.org/10.20448/journal.511.2021.81.48.56
Orji, A., Ogbuabor, J. E., Alisigwe, J. N., & Anthony-Orji, O. I. (2021). Agricultural financing, agricultural exports, and employment generation in Nigeria. European Journal of Business Science and Technology, 7(1), 74-90. DOI: https://doi.org/10.11118/ejobsat.2021.002
Phillips, P. C. B., & Perron, P. (1988). Testing for unit root in time series. Biometrika, 75(2), 335-345. DOI: https://doi.org/10.1093/biomet/75.2.335
Shiro, A. A., Abjia, R. O., & Fadun, O. S. (2023). Non-oil export and its effects on economic growth in Nigeria (1981-2020). Nigerian Journal of Risk and Insurance, 13(2), 1-18.
Sobel, M. E. (1982). Asymptotic intervals for indirect effects in structural equations models. In Leinhart (Ed.), Sociological methodology. San Francisco: Jossey-Bass, pp 290-312. DOI: https://doi.org/10.2307/270723
Solomon O. I., Tukur, M. U., & Zakere, S. (2018). A disaggregated impact of non-oil export on economic growth in Nigeria: 1981-2016. International Journal of Management Sciences and Business Research, 7(12), 67-77.
Uzma, K., & Aarif, M. K. (2023). An analysis of the effects of oil and non-oil export shocks on the Saudi economy. Investment Management and Financial Innovations, 20(1), 127-137. DOI: https://doi.org/10.21511/imfi.20(1).2023.12
Yilmaz, A. H. (2021). Effects of manufacturing export on employment in OECD Countries. Journal of Economic Policy Researches, 8(2), 1-26.
