On Thursday, August 24th, Nigeria reported its unemployment data for the first time in over two years. And the highlight is that the jobless rates have plunged from 33.3% to 4.1%. But before you celebrate, know that this ‘improvement’ did not happen because Nigeria created more jobs, but primarily because the country has changed its methodology for calculating unemployment.

According to the National Bureau of Statistics (NBS), unemployment declined to 4.1% in the first quarter of 2023 from 5.3% in the previous three months. The last time the country released jobless data was in March 2021, when it reported an unemployment rate of 33.3% in the final three months of 2020.

The NBS said the new figure is based on an “enhanced methodology of collecting labour market data through the Nigeria labour force survey in line with International Labour Organisation guidelines.” It also said the changes make comparing the new data with the former statistics impossible. And herein lies the problem: Nigeria is blurring its data lines.

Data is two-edged. It can inform or misinform, depending on who uses it and why. For instance, Nigeria’s data suggests that it doesn’t have an employment problem. The new result places the country in the same company as the UK, where unemployment was 4.2% in June, and in somewhat better shape than the eurozone’s 6.4%. But in reality, that’s not the case. The new system only changes how Nigeria defines its problem rather than solve it.

What’s different under the new framework?

First, the NBS has redefined who makes up the labour force. Under the previous calculations, people between  15 and 64 were the working population. Now, the working age is anyone above 15 years. This immediately increases the working population in Nigeria, which stood at 122 million as of 2020. So, people who were considered too old to be among the working population two years ago are now part of it. Nigeria has a young population, with a median age of 18.1 years. And these young people are more often the focus of unemployment data. But now, the NBS is taking more liberty to survey people outside this bracket.

Secondly, “employment” has a new meaning. Under the old methodology, you had to work at least 20 hours a week to be considered employed. But now, it’s anyone working at least an hour a week. And 76.7% of Nigerians fall under that category, even though only 11.8% have wage employment. At least nine out of 10 of those employed work in the informal sector, with about one-fifth of the working-age population not engaged in any form of work. On the one hand, this data could redirect the government’s attention to addressing underemployment. But on the other hand, it could create the illusion of abundance among Nigeria’s workforce.

However, it’s worthy of note that more working hours ≠ more productivity. Some people earn more while working less hours than others. It’s one of the reasons Nigeria has a serious wealth gap. And there’s a need to capture these people in national data.