Saturday, 25 May 2013
How Can We Create Jobs? By Debo Onifade
Many Nigerians followed the US presidential elections and showed a lot of excitement about Obama’s victory. I believe government officials were also energized, as we can deduce from the altercations between ACN and PDP that ensued after ABT (Ahmed Bola Tinubu) famously attended the Democratic convention. It is great that a significant percentage of Nigerians have shown great interest in American politics, but it is time for us to begin to demand that our political parties begin to copy ‘the good things’ in American politics. Throughout the campaign period, Obama and Romney had to consistently explain how exactly they intend to create about 12 million jobs in the next 4 years, which is a rough estimate of what is required to reduce unemployment rate to about 5%.
Obama touted continuously that his government facilitated over 5 million private sector created jobs in the last 3 ¾ years. These figures are verifiable and not mere assumptions. Sometime ago, the Obama government had to review the numbers downwards after a verification exercise revealed there were some wrong assumptions. A lot of direct government jobs were also created in the last 3 ¾ years but Obama didn’t tout this much because Americans typically don’t want to hear much about government creating jobs by itself. People see this as ‘bigger government’. In America ‘bigger government’ isn’t entirely negative and I have friends that got government professional jobs due to Obama’s ‘bigger government’ policy.
In Nigeria, we (especially journalists) must begin to ask PDP, ACN, CPC, LP, etc to explain to us exactly how they are creating jobs, how many jobs they have created, how they intend to create more jobs, and how they will create jobs when they win future elections. By the end of this year, GEJ should tell us how many direct government and private sector jobs his government has created in the last 18 months. The same goes for the governors. We need to know which governor is creating more jobs, what party they belong, how many jobs they are exactly creating, how they are creating those jobs, and how they intend to continually lower unemployment rates in their states. Undoubtedly, it is easier to create jobs in some states than others, but we must be able to quantify government efforts going forward. We should not be satisfied with vague promises and nebulous achievements.
Thomas Jefferson said in his 1801 inaugural address that ‘a wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and all that is necessary to close the circle of our felicities’. This statement fully corroborates many of my points. First, our governments must be wise and frugal. You cannot have enough money to facilitate jobs creation if you are wasteful and unwise with spending. It will never ‘add up’ and is just not possible. So we must be asking our politicians during debates and campaigns how exactly they intend to cut spending when they win elections. For the ones in government, we must continually ask them how exactly they have been cutting spending. Second, Thomas Jefferson talks about security. Truly, no government can have the energy, funds, and right concentration to tackle unemployment if there is no security. In fact, several companies are not growing in Nigeria today because of security challenges. You can’t keep shops or businesses open till very late because of security and that means you can’t hire extra staff for late night work.
People won’t even patronize you because they are scared to go out at night. Big companies spend heavily on security for their staff and property, reducing the cash available for them to grow their business or invest in other areas that would otherwise have generated employment. Third, Thomas Jefferson talked about free enterprise (I guess he may have referred to very limited or no government regulation). The world has changed since Jefferson’s time and I am a strong advocate of reasonably strict government regulation. So I differ with the highly esteemed Thomas Jefferson in this regard, but the clear point to Nigeria here is that government must always think about private-sector job creation and not think only ‘bigger government’ all the time.
We all know that ‘bigger government’ in Nigeria is ‘bigger political appointees’ and this has always escalated corruption. So, we must shrink our governments and develop ways to facilitate private sector driven employment generation. Finally, I believe Thomas Jefferson proposes that Nigerian workers (like those in other parts of the world) should be paid promptly and properly and they should not be taxed too much.
How do I think governments can create jobs in Nigeria? Among several other things (some of which I have mentioned above), the following are the 3 areas where I believe our governments should focus on to create jobs: (1) build enormous housing and rail infrastructure, (2) create new strategies and infrastructure to mitigate flooding and prevent future devastations (3) harness the power of agriculture in our country.
Can you imagine how many Nigerians will be employed if federal and state governments across Nigeria begin to spend massively on housing? Laborers, Artisans (carpenters, plumbers, painters, welders, builders, metal technicians, etc), engineers (electrical, mechanical, structural, civil, etc), architects, accountants, surveyors, businesses (quarries, metal companies, furniture companies, excavators, etc), finance companies, food sellers (they will be busy throughout construction period), etc. Aside from generating employment, if government fixes housing in Nigeria and develop a good mortgage scheme, people will be able to own or rent houses at less rates and most importantly they will be able to avoid the standard 2-year advance payment prevalent in Nigeria.
It is indeed very sad that fresh graduates or fresh employees have to save for several years and borrow money in order to RENT an apartment. In many parts of the world, people usually save up to buy houses, not save up to rent. When government creates employment through housing, they earn more taxes, but ultimately if the housing business is run properly in reasonable collaboration with the private sector, these houses will generate income for the government over a period of time.
I learnt from my parents and uncles that the Nigerian Railway Corporation used to employ thousands of Nigerians decades ago. It is a shame that this corporation was allowed to die. If this sector is revamped through public-private participation, engineers, drivers, conductors, maintenance technicians, book keepers, accountants, top managers, mechanics, etc will be employed again en-masse. In addition, people will spend less on transportation and their qualities of life will improve. Less people will drive their cars and pollution will reduce. When pollution reduces, health problems reduce in Nigeria, so government spends less on health care and productivity is enhanced. The business generates income for government, and it is a win-win scenario for government.
We have experienced massive flooding and devastation in Nigeria in the last few months. This is a wake-up call to our government. It has been estimated that Nigeria will likely be spending hundreds of billions to solve the resulting problems and mitigate future occurrence. Nobody can stop natural disasters, but we can build infrastructure to mitigate its effects. Governments should think about youth employment as they start spending money to solve the flooding problems. They should not consider quick fixes and give people opportunities to steal money. Government must bring forward experts from around the world (Nigerians and foreigners) to develop a comprehensive strategy to mitigate future occurrence, award the contracts to the most reliable companies (even if they are foreign) but ensure that Nigerian youths are employed to fully take part in the design, planning and construction works. If these youths require training, they should be well trained. We must use this disaster to rebuild and to create jobs for people.
Agriculture is a topic I won’t want to dwell too much on because it is an area that I think all governments in Nigeria accept is our most important path to success in future. America is the largest importer of Nigeria’s crude oil, but we would be foolish to think this demand will continue for the next 10 years. Already, America’s crude oil import from Nigeria and some parts of the Middle East has reduced. I have been telling friends for years that America will no longer need foreign oil very soon. When America no longer needs foreign oil, the new energy sources will move to other countries within a decade, and global crude oil demands will reduce tremendously. Aside from this, many African countries are now ‘finding’ oil, so oil will no longer be a special mineral in about 10 years from now.
What does that mean to Nigeria? Bankruptcy looms! The oil we currently have is not helping us to develop because of corruption. By the time the oil loses its value in about 10 years or so, we will be down to agriculture and a few other minerals. On the other hand, food supply is going to be a major problem for the world in coming years. Several countries are already planning ahead and Nigeria must harness this opportunity. First, we must be able to feed our people sufficiently, without importing basic food. I
If we achieve this alone, our GDP will grow significantly. Even at the current level of largely subsistence farming, agriculture continues to contribute highest to Nigeria’s GDP every year. So if we can grow the industry to meet all local needs, we would have done quite well. If we can grow our agricultural exports again as we did in the 1960’s and 70’s, Nigeria’s GDP will grow tremendously. But the most important thing to me is that agriculture can generate millions of jobs in Nigeria.
Government should be energized by the fact that job creation will reduce insecurity, reduce mortality rates, make it easier for politicians to govern, and promote peace in our land. This (not GDP growth) is the true sign of economic development!