Nigeria: 3 Hiring Challenges in Africa’s Largest Market

Given the country’s anaemic job growth, jobseekers dwarf the number of available jobs. Every year, the lopsided nature of the labor market gets worse. Although Nigeria’s job creation rose to 450,000 jobs in 2018, offsetting job losses to a limited extent from the previous year, an estimated 1.8m young people enter the job market annually.

This puts further pressure on a weak jobs market.

This can lead to mind-boggling figures.

Last month, a Lagos-based communications firm posted an intern position on Twitter.

Within days, it had been retweeted over 2,000 times. The number of applications, submitted through an online form, surged; the company received over 1,300 submissions crashing the application software. In practical terms, such a high volume of applicants is tantamount to zero since a total review is too costly and time consuming.

While policymakers’ attention is focused on the jobs crisis, its ripple effect on the labor markets is often overlooked.

Here are three insights that illuminate the hiring challenges in Africa’s largest economy.

1. Facing a flood of applicants, hiring managers recruit on ‘proximity’

In Nigeria, hiring managers face a deluge of applications due to job scarcity. According to Jobberman, a recruitment platform, for every 3 jobs posted on its site, there is a minimum of 100 applicants though that number can rise into the thousands per job.

When a large commercial bank advertised recently 80 entry-level jobs on Jobberman’s platform, over 21,000 people applied within 48 hours.

In the public sector, the numbers are worse. In January, the Security and Civil Defence Corps (NSCDC) advertised for 5,000 positions; it was swamped with 1.4m applications.

Given the high volumes of applications, hiring managers resort to recruitment by proximity. Instead of advertising opportunities publicly, thereby providing equal opportunity for all candidates, hiring managers recruit through their personal networks.

While hiring based on proximity can be an efficient hiring shortcut, the equivalent of asking a trusted contact for a recommendation, for the most part, it encourages nepotism. In Nigeria, proximity can often mean hiring from the same ethnic group.

Although hiring based on ethnic affiiliaition constitutes employer discrimination and is against the law, employers skirt around this by using geography as a proxy: southwest stands for Yoruba and south-south or southest for Igbo, etc.

2. The right candidates aren’t flowing to the right jobs

In a lopsided job market, qualified candidates and jobs are starkly mismatched.

The right candidates are not flowing to the right jobs. The applicant quality can run to extremes from the severely under qualified to overqualified.

The prevalence of under qualified candidates points to a chronic skills gap and underdevelopment of human capital in Nigeria.

According to the World Economic Forum’s human capital index, Nigeria scored 44 percent on its human capital development as measured by investment in education and skills acquisition, trailing behind the Sub-Saharan African average of 55 percent.

Employers faced the most difficulties in filling managerial, professional and technical jobs due to a lack of skilled applicants. In a 2017 UNIDO-led survey, 8.3 percent of all survey participants had a vacancy after having failed to find a qualified candidate.

But, given job scarcity, Nigerian workers also take jobs for which they are vastly overqualified, driving a high underemployment rate.

In the third quarter of 2018, Nigeria’s underemployment rate stood at 20.1%, not far behind the unemployment rate of 23.1%.

While this largely results from the dominance of the informal market in driving job creation, it is equally a trend in the formal labor markets. Just as a university grad is likely to drive an okada (a motorcycle taxi), a PhD holder is likely to apply for an entry level job, or internship, at a bank or telecoms provider.

3. High potential candidates remain invisible to recruiters due to lack of job counseling services

High potential candidates go under the radar of recruiters because they struggle to write effective CVs. This points to the poor availability of career guidance and counseling services in Nigeria. Career guidance helps to smooth a disconnected labor market: well-written CVs signal competence to recruiters who can easily identify qualified candidates.

In recognition of its importance, in 2007, the Nigerian government mandated that universities provide career guidance services to students. But, by 2014, only 20% of federal universities and less than 10% of private universities offered services, such as CV writing and interview preparation, on their campuses.

Given the lack of well-written CVs, Jobberman has had to invest in CV writing cliniques for jobseekers on its platform. In February, a webinar attracted 5,000 viewers while 200-1,000 people will attend an average employability training session, demonstrating a real need in the market.

Nigeria’s hiring challenges — a byproduct of its lopsided labor market — can no longer be ignored.

By impeding productivity at a company level, the mismatch between jobs and well qualified employees stunts Nigeria’s economic growth.

Luckily, there are solutions in sight. HR technology using algorithms to match the best qualified applicants to job descriptions can help hiring managers short-list candidates efficiently, eliminating a large reason for hiring on proximity.

This, in turn, is crucial to creating a culture of meritocracy in the workplace. Hiring the right candidates for the right jobs is a critical step in putting the Nigerian economy on the road to recovery.