By Peter Lucille
Unemployment is a persistent problem in Nigeria, especially amidst the ongoing recession engulfing the country. Nigeria has an estimated 151 million youths, with around 53.40% unemployed, amounting to over 80 million individuals, as per the Youth Unemployment rates released by the National Bureau of Statistics in 2022. The rise in crime rates, particularly ritualism, can be attributed to the macroeconomic problems of unemployment, inflation, and poverty.
Given the large population of the country, it becomes challenging for the government to provide jobs for everyone. Additionally, factors such as the fuel subsidy saga, which has caused an increase in the cost of raw materials and finished goods, can be discouraging for undergraduates.
Financial constraints hinder Nigerian undergraduates from funding their own start-up companies. There are two types of capital required to fund a business: startup capital, which is the money needed before the business opens, and working capital, used for day-to-day expenses until the business becomes cash flow positive and self-sustainable.
To establish a registered company, a Tax Identification Number is required by the Corporate Affairs Commission. Taxes pose financial and administrative burdens for small start-ups, directly impacting their ability to invest and compete in the broader economy.
Poor infrastructure also increases operational costs, such as relying on external power sources due to inadequate power supply, resorting to alternative distribution methods due to poor road networks, and facing limitations on the customer base due to limited internet accessibility.
Keeping a close eye on changing policies becomes crucial, as they can significantly affect businesses. For instance, the redesign policy in the first quarter of 2023 led to a shortage of cash circulation, negatively impacting several informal sector businesses.
Ignorance in a business setting can be detrimental, causing misinformation about market prices and identifying target demographics, leading to blind marketing and losses in terms of money, time, and resources.
The government plays a crucial role in fostering an environment that encourages youth company ownership. By implementing the right policies and initiatives, they can provide the necessary support and resources for young entrepreneurs to thrive. One way the government can encourage youth company ownership is by offering financial incentives such as tax breaks or grants specifically targeted at youth-led businesses.
These incentives can help alleviate the financial burden associated with starting a company and make entrepreneurship a more viable option for young people. Additionally, providing access to low-interest loans or venture capital funding can empower young entrepreneurs to pursue their business ideas.
The government can also establish entrepreneurship programs and workshops that provide mentorship, training, and guidance to young people looking to start their own companies. By equipping them with the necessary skills and knowledge, the government can boost their chances of success.
Moreover, creating networking platforms and incubation hubs where young entrepreneurs can connect, collaborate, and receive guidance from experienced professionals can further support their journey.
Lastly, the government can encourage public-private partnerships, where established companies provide mentorship, investment, and guidance to young entrepreneurs. This collaboration can help bridge the knowledge and resource gap, allowing youth-led businesses to flourish.
Overall, the government’s proactive involvement and support are instrumental in fostering a culture of youth entrepreneurship and inspiring the next generation of business leaders.
Peter Lucille is a student of Mass Communication in Ahmadu Bello University, Kaduna State, Zaria