High levels of joblessness have emerged as a critical policy issue in Nigeria. From 2010 to 2018, the unemployment rate surged from 5% to 23%. Compounded by the impact of the COVID-19 pandemic, the economy is failing to create an adequate number of employment opportunities, especially for women and young people. As the shortcomings of traditional sectors like manufacturing in driving economic growth and employment have become apparent, attention has pivoted toward investigating alternative sectors that can stimulate both economic development and job opportunities.

Industries Without Smokestacks and Their Impact

Industries without smokestacks (IWOSS) encompass industries with superior labor productivity compared to traditional agriculture. These sectors encompass agro-processing, financial and corporate services, information and communication technology (ICT), tourism, formal trade and transportation.

The growing significance of the IWOSS sector in Nigeria is particularly important, given that data suggests the employment crisis has escalated into a significant issue. For instance, the financial and business services sector led to an increase in employment rates, accounting for 23.5% of the growth share between 2010 and 2018. In contrast, sectors like mining demonstrated minimal improvement, registering a mere 0.1% increase, underscoring the transition from traditional sectors to newer, service-oriented ones.

IWOSS sectors provide diverse job opportunities that cater to individuals with a range of skills and expertise levels. This opportunity means that people with lower levels of education or skills can still find employment in these sectors, helping reduce unemployment and alleviate poverty.

Job Opportunities for Women and Youth

A notable feature of the IWOSS sector in Nigeria is their propensity to hire women, young individuals and those with low education and skills. These sectors have consistently attracted a greater proportion of workers from these specific demographics in comparison to sectors outside the IWOSS realm. In 2018, for example, 34% of the IWOSS sector in Nigeria consisted of females, while the non-IWOSS workforce exhibited a lower representation of women at 32%. Predictions indicate that the IWOSS sectors will experience a continued rise in female employment by 2025. These figures demonstrate the advancement of gender equality in the labor force. This sector offers favorable prospects for women to overcome the obstacles that have historically hindered their participation and progress in conventional industries.

Advantages of IWOSS

An important benefit of IWOSS is its adaptability, which allows women to manage both their professional and family obligations effectively. Introducing remote work choices, freelance positions and flexible scheduling has transformed the job market, especially for women.

Given that IWOSS sectors in Nigeria prioritize skills over physical strength, they offer an equitable platform for women to excel and prosper. By offering flexible work arrangements and prioritizing skills over physical strength, IWOSS sectors create a more inclusive environment for women to participate in the workforce. Empowering women with employment opportunities can lead to economic independence and, in turn, reduce poverty among female-headed households.

Just like the manufacturing sector, these industries share the characteristic of being export-oriented, meaning they engage in trade and benefit from global markets. Additionally, they harness the advantages of technological innovations, leveraging cutting-edge tools and processes to enhance productivity and competitiveness.

Furthermore, their substantial reliance on a workforce encompassing individuals with lower to intermediate skills and expertise sets them apart. This reliance means that these sectors offer employment opportunities for a wide spectrum of workers, ranging from those with basic skills to those with more specialized training, making them accessible to a broader segment of the population.

The IWOSS sector in Nigeria is swiftly gaining prominence and playing a progressively larger role in employment. IWOSS can create many job prospects for Nigerians, particularly for the younger generation. The adaptability, inclusiveness and resilience that IWOSS has exhibited over the last two decades, even amid the challenges that the COVID-19 pandemic posed, underscore its capacity to foster job growth.

– Susanna Andryan
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