ROLE OF SMALL AND MEDIUM SCALE ENTERPRISES IN UNEMPLOYMENT REDUCTION IN NIGERIA: In Nigeria, a considerable portion of the population is unable to find formal employment opportunities, which contributes to the country’s ongoing problem with high unemployment rates. In recent years, there has been a rising acknowledgment of the critical role that small and medium scale organisations (SMEs) may play in resolving this issue. This recognition comes as a result of the fact that SMEs make up 99.7% of all businesses in the United States. It is possible for small and medium-sized businesses (SMEs) to boost economic growth, generate new jobs, and bring down the unemployment rate in the country. In this essay, we will investigate the many different ways that small and medium-sized enterprises (SMEs) contribute to the reduction of unemployment in Nigeria.
To begin, small and medium-sized enterprises are notoriously labor-intensive. Small and medium-sized businesses (SMEs) are primarily dependent on human resources, in contrast to huge enterprises, which frequently rely on automation and modern technology. As a consequence of this, they are in a position to take on a sizeable number of folks who are currently jobless. These types of organisations typically have lower barriers to entry, making it simpler for individuals who have fewer resources or expertise to launch their own companies. Because of this, unemployed people have the opportunity to start their own businesses or participate in activities that generate cash, which helps bring the general unemployment rate down.
Moreover, small and medium-sized businesses encourage entrepreneurialism and innovation, both of which are essential engines of economic growth and employment creation. The culture of entrepreneurship is cultivated through small and medium-sized enterprises (SMEs), which encourage individuals to start their own firms. This, in turn, leads to the creation of new ideas, products, and services. This entrepreneurial ecosystem not only creates job prospects for the entrepreneurs who participate in it, but also for the workforce that the entrepreneurs hire. The growth of these companies results in the creation of extra employment opportunities and a general decrease in the rate of unemployment.
There is a problem in Nigeria with underemployment, and small and medium-sized businesses have the ability to help solve this problem. A large number of people in this country are deemed to be underemployed, which indicates that they are either working part-time or are employed in positions that do not make full use of their talents and credentials. These persons who are now underemployed have the opportunity to find work that is more suited to their skills and interests through the employment opportunities presented by small and medium-sized businesses (SMEs). SMEs contribute to the reduction of underemployment and the enhancement of overall job satisfaction by creating possibilities for individuals that are in line with their strengths and aspirations.
In addition to the direct employment contributions they make, small and medium-sized businesses (SMEs) also have a considerable impact on the economy as a result of the linkages they have established with other industries. These companies frequently rely on regional suppliers and services, which in turn generates demand for the products and services offered by other companies in the area. Along the entire supply chain, this reliance between smaller businesses and larger enterprises helps to stimulate economic growth and the creation of new jobs. Small and medium-sized enterprises (SMEs) in Nigeria contribute to the growth of a vibrant and diversified economy by expanding their linkages and strengthening their existing ones. This, in turn, creates more employment possibilities for the Nigerian labour force.
Nevertheless, it is essential to keep in mind that small and medium-sized businesses (or SMEs) confront a variety of obstacles, which may impede their capacity to efficiently cut unemployment. In Nigeria, the most significant challenges that small and medium-sized businesses face are limited access to funding, inadequate infrastructure, and an inadequate supply of business support services. To effectively address these difficulties, the government, financial institutions, and any other relevant players will need to collaborate their efforts. Policymakers have the ability to foster the growth of small and medium-sized enterprises (SMEs) and increase the job opportunities available to the greatest extent possible by giving targeted financial support, improving infrastructure, and providing programmes to enhance capacity.
In conclusion, it can be said that small and medium-sized businesses have an important part to play in the fight against unemployment in Nigeria. Small and medium-sized businesses (SMEs) present workable alternatives to the nation’s high unemployment rates because of the labor-intensive nature of their operations, the entrepreneurial spirit they foster, and the economic growth they foster. In addition, by combating the issue of underemployment and developing linkages with other industries, the businesses in question contribute to the general improvement of the economy as well as the creation of new jobs. In order for small and medium-sized enterprises (SMEs) to realise their full potential, it is crucial for the government and other stakeholders to address the issues that SMEs encounter and provide the necessary assistance and infrastructure. Small and medium-sized businesses have the potential to become a potent engine for the creation of new jobs and the expansion of the economy in Nigeria if the appropriate policies and conditions are in place.