The Role Of Small Scale Business In Job Generation In Nigeria

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The Role Of Small Scale Business In Job Generation In Nigeria


The study of the Role of small scale Business in jog Generation Nigeria (a survey of Oshodi/Isolo LGA of Lagos State) was carried out to assess the extent of job generation through small scale businesses in Nigeria. Descriptive research methods was employed in carrying out the study. The population of the study was 1, 113,000. A sample size of 400 was derived using Yaro Yamani formular; Bowley’s proportional allocation formular was applied in allocating questionnaires in various stratums under study. 373 questionnaires were dully filled and returned out of 400. Analysis was done using tables and simple percentage. Formulated hypothesis was also tested using X2 (Chi-square) The study revealed that the small scale business boosts the economy of any nation. It was also discovered that small scale business offers a lot of employment opportunities for graduates than government jobs. Furthermore, it was discovered that small scale business has suffered a lot of hitches as a result of lack of funds, inadequate infrastructures, ineffectiveness of government policies and lack of proper education for the practitioners of this businesses.

Chapter One


1.1 Background of the Study

The role employment in poverty reduction programmes in developing countries like Nigeria has received considerable attention world wide, in development strategies and policies. Here in Nigeria, the disease of unemployment is being suffered by almost majority of the citizenry and in all aspects of life Yearly, the number of young school leavers entering into the labour market increase geometrically as they are looking for non-existing white-kola jobs. To this effect, it easily be inferred that up to 80% of both young and able-bodied Nigerians are constantly roaming about in the streets looking for both fresh and better job opportunities.

However, the truth remains that in Nigeria, the story of unemployment is supposed to have been a past story. This is because Eze (1999: 6) state that Nigeria is a country greatly endowed with many natural and human resources. The business environment apparently offers opportunities for many entrepreneurial ventures. Ironically, despite this endowment, her state of economic development leaves much to be desired.

Meanwhile, the government of this nation both past and present embarked on several campaigns against unemployment and equally established many bodies to put an end to the unemployment story in this country, but all were to no avail. Also, the international communities have in so many ways contributed to the reduction of unemployment in Africa, especially in Nigeria, but the story still remain the same.

Thus, unemployment means different things to different persons and different countries. O Nigerians, according to Ike (1998), unemployment means that people who are able, willingly and qualified to be employed to help themselves, and the society to reduce idleness and frustration but are not employed because of lack of job opportunities. To him, unemployment is seen to be existing only when people are not engaging themselves at all in some paid jobs and this is clearly proven when he/she is idle.

In a developed country like America, unemployment is not only when someone is idle and doing nothing, it also exist when he/she is not rightly employed in the type of job that suit him according to his level and discipline.

Generally, unemployment according to Oxford Advanced Learner’s Dictionary is defined as the fact a number of people not having a job or the number of people without a job. In a nutshell, unemployment is a cancer that has eaten deep into fabrics of this Nigeria and it is the objectives of this research work to x-ray the major causes of this ugly trend and equally showcase how this problem can be solved.

1.2 Statement of the Problem

Years back, between 1960 and the 1970 (according to an internet report), students of tertiary institutions were being booked for employment by cooperate organizations even when some of the students will have up to a year or two to conclude their degree programmes. This could be as a result of the limited number of tertiary institutions coupled with low turn out of students in the school, which was as a result of the people’s ignorance of the great value of education.

Gone are those years, when young graduates gained lucrative jobs first immediately after graduation; – Nowadays, the number of graduates deployed into the society for all well paid job out-numbered the little available jobs and al efforts both by the government and private sectors to curb this menace had proved abortive.

It is based on the above back drop that the following problems were deduced:

  1. As a result of unemployment, crime rate is on the increase in the country.
  2. It has also made youths to divert their interests from innovative and self-employable programmes to politics. Some are political thugs.
  3. There is also poverty and hunger among the people, especially the dependable population, yet the agricultural sector is neglected.
  4. Foreign investors are scared of investing in Nigeria.

1.3 Objective of the Study

In this work, the researcher tends to probe into the topic of unemployment through these question:

  1. Can unemployment actually be solved by increased small business in Nigeria?
  2. Does capital (fund) posses any impediment to the establishment of small scale organizations in Nigeria?
  3. Why the neglect of agricultural sector by the youths?
  4. Are foreign investors scared of investing in Nigeria?

1.4 Research Questions

These questions are:

  1. What is job creation all about?
  2. Why is the role of small business necessary on poverty alleviation and job creation in Nigeria?
  3. Has small business impact on the unemployed positively or negatively?
  4. How has this poverty alleviation programmes been implemented?
  5. Is there areas where this poverty alleviation programme can be strengthen?
  6. How sure are we that small business do help in alleviating poverty and creation of jobs in Nigeria?

1.5 Research Hypotheses

  1. H0: Small business has no positive impact on job creation in Nigeria
    H1: Small business has a positive impact on job creation in Nigeria
  2. H02: There is no significant relationship between small business and job creation in Nigeria.
    H2: There is a significant relationship between business and job creation in Nigeria.

1.6 Scope and Limitation of the Study

This research is aimed at assessing the role of small business in jobcreation in Nigeria, a case study of Ubotex Nigeria Limited is one disease that has left Ubotex Nigeria Limited people designed and under-develop and Nigerian in general, for it to be eradicated successfully, people business or the other so as to improve their standards of living. Therefore, the scope of these study will not go beyond Ubotex Nigeria and Nigeria in general.

(a) Availability of Research Material:

The research material available to the researcher is insufficient, thereby limiting the study.

(b) Time:

The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.

(c) Finance:

The finance available for the research work does not allow for wider coverage as resources are very limited as the researcher has other academic bills to cover.

1.7 Significance of the Study

The importance of this study cannot be over emphasized. Business on it own plays significant role in the social by making goods and services available within the Nigerian economy. Therefore, an economy is made up of business activities that are consciously set up and directed at providing want satisfying goods and services, thereby help to reduce poverty in the lives of those who engaged in the activities.

Any research is always beneficial to various interest groups within the economy. This research will be beneficial to government can help the poor by granting loans and subsides so that they can start small scale business to better their lives. It will also help the government in formulating economic policies. This research will also help the poor to identify the class of business activities they should embark upon. The study will create awareness among Ubotex Nigeria by engaging in economic activities.

This research will by extension enable the micro-finance institutions to realize the need to provide loans to the people at grass root for investment. Above all, this research will be of immense benefit to the reading public and researching students who will wish to carry out further study on this topic and related ones a sit will form a reference point for them

1.8 Definition of Terms


Poverty is the scarcity or the lack of a certain amount of material possessions or money. Poverty is a multifaceted concept, which may include social, economic, and political elements.

Poverty Alleviation

Poverty reduction, or poverty alleviation, is a set of measures, both economic and humanitarian, that are intended to permanently lift people out of poverty


Small and medium-sized enterprises or small and medium-sized businesses are businesses whose personnel numbers fall below certain limits

1.8 Organization of the Study

This research work is organized in five chapters, for easy understanding, as follows

  • Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study.
  • Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature.
  • Chapter three deals on the research design and methodology adopted in the study.
  • Chapter four concentrate on the data collection and analysis and presentation of finding.
  • Chapter five gives summary, conclusion, and recommendations made of the study

Chapter Five

Summary, Conclusion and Recommendation

5.1 Introduction

It is important to ascertain that the objective of this study was to investigate the role of small businesses in job creation.

In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing the role of small businesses in poverty alleviation in Nigeria.

5.2 Summary

This study has shown that there are so many lucrative business you can start small in rural areas and yet make it big and interesting as well as running away from poverty and increasing the economic growth of your locality. Staying in rural areas is no reason why you will not be able to succeed if you want to. All you just need is a determined mined set and a good business strategy. It has shown that corruption and political interference are the detrimental factor of achieving the goal of National poverty Eradication programme (NAPEP). The paper thoroughly touches the challenges by poverty and the ways of tackling the challenges by improving small scale business;

5.3 Conclusion

This study investigated the role of small scale businesses on job creation in Nigeria. In specific terms, the study examined if smallbusinesses has significant effect on poverty alleviation in Nigeria; the socio-economic characteristics of small businesses inNigeria; and the major challenges faced by small businesses in Nigeria. The results indicate that small businesses has significant positive impact on poverty alleviation, job creation, and income generation in, Nigeria. The results further indicate that average annual incomes, number of children sponsored in school and health facility patronized significantly influence the poverty status of the respondents. Besides, the key challenges faced by small businesses in Nigeria were highlighted to include poor infrastructure, low prices of raw materials.

5.4 Recommendation

In view of the above, the paper suggests the following;

The need for the government to empower the efficiency of poverty reduction agencies with a view to fight corruption and promote the integrity and accountability with the institutions.

There is need for an effective and efficient enlightenment and awareness campaign in the rural areas on the importance of small scale enterprises as a tool of becoming selfreliant and improve standard of living.
Improving the level of literacy in the rural areas in accepting bank loan and avoid the wrong perception that loan posed a threat to their future.

Promoting the efficiency of basic human needs, infrastructural facilities and social amenities such as good roads in order to ease the transport.

There should be well equipped acquisition centers in every local government area of AkwaIbom State in order to enhance the training of youths, by engaging them in skills like weaving, carpentry in reducing the rate of unemployment.

In the implementation of the millennium development goals (MDG’s) emphasis should be given to community empowerment of boosting the small scale business.

Community empowerment efforts leading to poverty reduction should be based on community driven development (CDD) in which rural individuals will be involve in decision making on matters affecting them so as to have accurate sustainable development.

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