Empirical Appraisal of Poverty-Unemployment Relationship in Nigeria

The relationship between unemployment and poverty has been of interest to many a scholar with interest in development economics and social sciences. This paper is an addition to the empirical attempts to re-examine the relationship between unemployment rate and poverty incidence in Nigeria using secondary data sourced from relevant institutions to obtain major Social and Economic indicators spanning within 1980-2015. The study used Trend graph analysis, Correlation coefficient analysis and Granger causality tests in its analyses. As shown from the results, there is a positive-significant correlation between unemployment and poverty in Nigeria. More so, this was corroborated by the Trend graph analysis. It also established that unemployment granger causes poverty in Nigeria as suggests from the Granger causality tests. The economic implication of this result is that poverty is an increasing function of unemployment; and the Error Correction Mechanism (ECM) pointed that short run disequilibrium in the economy can be returned to equilibrium in the long run with a poor speed of adjustment of 6 %. In the light of these findings, this study recommends that efforts should be intensified in Nigeria towards implementation of unemployment reduction policies as this will significantly reduce poverty incidence.