Inflation: the high flyer
Inflation grew by 0.40% points between July 2020 (12.82%) and August 2020 (13.22%). This is notably the highest recorded rate since March 2018 (13.24%).
With the drop in oil prices and the development of stringent policies (due to the COVID-19 pandemic) around the operation of several sectors in Nigeria, the country has recorded new heights in negative growth within the past months.
The rise in inflation was markedly potentiated by an increase in passenger transport by air and road, hospital services, medical services and products, maintenance services, and the repair of personal transport equipment.
Additionally, increases in the prices of bread and cereals, Potatoes, yam and other tubers, Meat, Fish, Fruits, Oils and fats and Vegetables, resulted in increased food inflation (16%) in August 2020. This is higher than the recorded rate of 15.48% in July 2020 and nearly increased by double in the past year (13.17% – Food inflation in August of 2019).
The inflation rate has been on a steady rise since January 2020 (12.1%) and this, alongside the recent increase in debt portfolio and unemployment rate exposes the economy to a recession, which experts predict will take full effect in the fourth quarter of 2020.
A Career Exodus
Nigeria recently stands among the 10 least desirable countries, in the world, to start a career. This ranking was estimated by CEOWorld, via an assessment of job market reliability, economic stability, entrepreneurial atmosphere, income equality, innovation, progressiveness, and a desire for adults younger than the age of 35 to live in a given country.
This follows the recent rise in the unemployment rate (at 27.1%), a number highest for individuals aged 15-34 (34.9%) and higher than the previous unemployment status report of 23.1% in 2018. Only within Q2 of 2020, unemployment rose from 29.7% to 34.9% for those between the ages of 15-34 years old.
With up to 348,000 Nigerian migrants currently in the United States of America (U.S), a 2019 study conducted by PEW Research Institute found that 45% of Nigerians reported interest to migrate in the near future for a better job and educational opportunities. In this study, 28% of Nigerians registered an interest in migrating to the U.S, 19% to a European country, and another 19% to a Middle Eastern country.
The rise in the unemployment rate could serve as a motivator for a future rise in the exodus of professionals to countries such as Canada, the U.S, and the UK.
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