News: 6.9m Jobs in Crumbling Construction Sector - National Bureau of Statistics (NBS)

National Bureau of Statistics (NBS) - Data recently released by the National Bureau of Statistics (NBS) show that the formal construction sector grew and added millions of jobs in the economy. But our investigations rather point that the formal construction sector did not fare better under the reviewed period.

Nigeria is said to have population growth of 2.5 percent annually. This growth causes simultaneous increase in human needs. Any society that experiences this must have realisable plans that match growth with infrastructure needs. There must be building of more houses and roads and above all provision of more job opportunities. Nigeria's unemployment rate is simply disturbing so much that talk is all about job creation.

The data from the National Bureau of Statistics (NBS) indicates that the construction formal sector of the Nigerian economy created 6,913,536 jobs by 2012.

A breakdown of the report shows that 6,415,082 persons were engaged in 2010. There was an increase by 3.21 percent or 205,760 to reach 6,620,842 in 2011. This figure grew by 4.42 percent or 292,694 to reach 6,913,536 in 2012.

The report revealed that the Nigerian male employee constitutes a very large portion of the total number of persons employed in the sector with a percentage share of 91.38 percent in 2010, 91.61 percent in 2011 and 91.52 percent in 2012. The Nigerian female employee stood at 398,403 in 2010, 396,602 in 2011 and 420,779 in 2012.

While there was a steady increase in the number of Nigerian male employees for all three years, the females saw a decline in their numbers by 0.45 percent between 2010 and 2011, but an increase by 6.10 percent for 2012.

It was found that wages and salary are the most common form of employee compensation in the sector.
Moreso, NBS said the construction sector has contributed about N5.67 trillion to Nigeria's economy in three years.

The bureau's report indicated that total income in construction has risen steadily between 2010 and 2012. The report stated that Nigeria's real Gross Domestic Product (GDP) for the year 2010 was N54.61 trillion in which construction sector's share of 2.88 percent was N1.57 trillion. The construction sector grew by 21.30 percent to reach N1.91 trillion in 2011.

A slowdown in growth rate of the construction sector by 14.86 percent resulted in the sector closing at N2.19 trillion in 2012, hence the share of construction to GDP that same year stood at 3.05 percent.

Explaining the reason for huge contribution from the sector to the economy, the NBS noted that the better capturing of all the economic activities in the construction sector is the magic. "Prior to rebasing, construction data was mainly sourced from construction of buildings and construction of roads and railways activities. Now, construction activity has been broken down into 11 different activities, bringing the total for the construction sector to 13," the report stated.

How realistic are the statistics? It is not clear how construction sector grew as shown above.

Many wonder how the sector could have grown when in most states of the federation, hardly are formal construction works. Apart from in few states like Akwa Ibom, Kano, Lagos, Rivers, Jigawa and the Federal Capital Territory (FCT) one can hardly see construction works. Many states are not doing projects.

Moreso, companies are generally closing in Nigeria. Some of them relocate to other parts of the world. Construction companies that were once household name in the 70's and 80's have gone under or are barely existing. The ones that appear to be working depend on expatriates as their core staff, meaning hands are sourced abroad.

Costain West Africa Plc, a once popular construction firm that entered Nigeria from the UK is near dead. Its office in Lagos is without the bustle that characterizes premises of a big contract handling firm. Last year, Costain workers protested nonpayment of salaries.
Julius Berger Nigeria Plc is the biggest construction company in Nigeria. The company has been reducing workforce (mainly Nigerians) since 2004 due to stifling business conditions. Mr Clement Iloba, the head of Public Relations, Julius Berger Nigeria Plc did not attend to our reporter when he visited the company's head office in Abuja. He was said to be in a meeting. But a staff of the company who did not want to be named here said the company has been in dire straits and has been reducing staff since 2004. "It's difficult for us," the staff expressed.

Apart from delayed pay, many contracts suffer because of what is called variation. Contractors abandon work in the middle and wait for additional pay. They always claim that in the course of execution of the job, they discover new things that should be paid for.
Then government is not doing new projects. Old roads are only being reconstructed. Major roads like Abuja-Lokoja, Benin-Ore-Lagos and the major railways have been under reconstruction for many years. Even the 10,000 housing scheme promised Nigerians in the Mortgage Refinance scheme since last year has remained just paper work. The question is how can the construction sector grow and create many jobs if contractors are owed huge money and new projects are not opened?

Executive Secretary of the Nigerian Society of Engineers (NSE) Engr. Olusola Temitayo Obadimu could scarcely see the link between the figures released by NBS and practical happenings. According to him, job creation is a factor of economy stimulus. He observed that if only 20 percent of Nigeria’s budget goes for capital expenditure, it will be hard to stimulate the economy and create jobs for an ever rising population.

Chances are even slimmer considering that the 20 percent capital vote seldom wholly goes for the purpose enunciated.
"Fixing economy is fixing infrastructure," the Executive Secretary maintained. He said serious economies develop and religiously implement developmental plans that take 50 or more years. These development plans are broken down for implementation like five or 10 years.

He questioned the kind of job that was captured in the NBS statistics saying temporary jobs that last for say three months cannot be conveniently called jobs. He insisted, "They must be meaningful jobs".

Concerning wages, he lamented that much of what Nigerian employee collects is set aside to fix infrastructure deficit. That is wages that would have made life meaningful to the worker fly away. For this reason, many Nigerian youths leave the country for where environment is predictable."

According to Obadimu, the real solution to the problem is economy stimulus which involves reducing overhead costs, reducing the number of hands in government and ultimately shoring up infrastructure spending.

Source: Dailytrust