Rural Transformation and Labor Market Outcomes among Rural Youths in Nigeria

In Nigeria, unemployment in rural areas translates to economic problems, such as high levels of rural–urban migration. Interventions aimed at promoting rural transformation and development are designed to generate employment by promoting the growth of sectors such as manufacturing and services in rural areas. In this study, the General Household Survey (GHS) panel data for the post-planting and post-harvest periods of the 2011/2012 and 2015/2016 cropping seasons for Nigeria was used to investigate developments in rural areas in Nigeria between 2011 and 2015, and identified how these developments influenced labor market outcomes among rural youths. Fixed effect models were employed to control for unobserved heterogeneity that may exist because of the different years in the data used. Key levers of sustainable social and economic development, such as access to finance, health services, markets, and infrastructure such as electricity, were considered. The empirical results from the study revealed that being educated as well as having access to infrastructure and information had positive effects on the number of youths that took up wage/salary employment in the rural areas. The study concluded that the diversification of youths into other sectors would have higher growth effects on the development of rural areas, as they can invest more in agriculture, while also reducing the level of dependence on the sector. The study recommends an increase in budgetary allocations for education and rural development projects, with a special focus on electricity and financial institutions, while increasing access to information on available job opportunities.