National Employment Policy of Nigeria – Labour Market Systems, Employment Strategy and Inclusive Growth Framework

1. Executive Summary

This report supports the development and strengthening of Nigeria’s National Employment Policy, providing a comprehensive analysis of labour market systems, employment challenges, and policy frameworks for job creation and inclusive growth. It examines structural issues affecting employment outcomes, including informality, youth unemployment, skills mismatches, and limited private sector absorption capacity.

The analysis emphasizes the need for integrated employment policy frameworks that align labour market dynamics with economic development strategies, education systems, and institutional coordination. It highlights the importance of strengthening governance systems, improving labour market data, and enhancing policy implementation mechanisms.

The report contributes to national policy discourse on employment systems, labour market reform , and inclusive development, offering evidence-based insights for policymakers, government institutions, and development partners.

This report is designed primarily for:

❖Federal, state, and local government policymakers responsible for employment and economic development

❖Ministries, Departments, and Agencies (MDAs) involved in labour, education, enterprise development, and economic planning

❖Private sector organizations and business leaders seeking to expand employment opportunities

❖Employers’ associations, professional bodies, and labour unions

❖International development partners and multilateral institutions working on employment and labour market reforms

❖Researchers, policy analysts, and academics studying labour markets and economic development

❖Civil society organizations and non-governmental organizations engaged in employment promotion and social protection

2. Methodology & Analytical Framework

The report adopts a labour market diagnostics and policy analysis framework , combining qualitative and quantitative approaches to assess employment systems and policy effectiveness.

The analytical approach includes:

Labour market diagnostics, examining employment trends, informality, and sectoral dynamics

Policy systems analysis, assessing institutional coordination and governance structures

Economic and employment systems evaluation, linking labour market outcomes to macroeconomic conditions

Stakeholder and institutional analysis, identifying gaps in implementation and coordination

Comparative policy insights, aligning national frameworks with international labour standards

This framework enables a comprehensive understanding of employment systems, policy gaps, and pathways for labour market reform and inclusive growth.

3. Key Insights & Major Findings

1.Nigeria’s economic growth has been largely jobless, with GDP expansion not translating into sufficient employment opportunities.

2.A large proportion of employment occurs in the informal sector, where income levels and job security are generally low.

3.There is a significant mismatch between the skills produced by the education system and the skills demanded by the labour market.

4.Youth unemployment and underemployment remain major challenges, given Nigeria’s rapidly growing working-age population.

5.Poor infrastructure and limited access to finance constrain private sector growth and employment creation.

6.Weak coordination among government programmes has led to duplication of employment initiatives and inefficient resource utilization.

7.Strengthening human capital development, entrepreneurship, and sectoral value chains is critical for sustainable job creation.

8.High levels of informality and youth unemployment remain central challenges in Nigeria’s labour market

9.Skills mismatches limit workforce productivity and private sector employment absorption

Effective employment policy requires coordination across education, economic, and institutional systems

10.Labour market data gaps constrain evidence-based policymaking and programme design

11.Inclusive growth depends on strengthening employment systems and private sector development

12.Institutional capacity and governance structures are critical for policy implementation