No fewer than 3,567 jobs were lost in the manufacturing sector in the first half of 2023 according to figures obtained by CEOAFRICA from the Manufacturers Association of Nigeria.
MAN disclosed this in its half yearly review of the economy, which was released on Tuesday.
According to the report, employment generation in the manufacturing sector declined to 6,428 in the first half of 2023.
This was 32.8 per cent reduction in employment generation capacity when compared with 9,559 jobs generated in the first half of 2022.
The report read partly, “In the same vein, a total of 3,567 jobs were lost in the first half of 2023, indicating 1,855 more jobs lost when compared with the 1,709 jobs lost in the corresponding half of 2022, and 850 more jobs lost when compared with 2708 jobs lost in the last half of 2022.”
MAN said the decline in the number of jobs created in the sector during the period further highlighted the unfriendly business environment, resulting from the hasty policies and residual effect of the currency redesign policy that led to the naira crunch.
The report also stated that the inventory of unsold finished products in the manufacturing sector increased to N271.9bn during the first half of 2023, compared to N187bn in the corresponding period of 2022.
This indicated a substantial rise of N84.88bn or 45.4 per cent over the timeframe. It also showed N11.64bn or 4.1 per cent decline when compared with the inventory value of N283.6bn recorded in the second half of 2022.
“This increase in inventory can be attributed to a weakened purchasing power of the consumers, brought about by diminishing real household income resulting from the ongoing escalation of inflationary pressures, compounded by the scarcity of naira in the first quarter of the year and the aftermath of the subsidy removal,” the report said.
It noted that subsidy removal and exchange rate unification policy towards the end of the first half left the economy on the brink of uncertainty, caused a ripple effect that further eroded investors’ confidence.
MAN stated that, “As a result, businesses and foreign investors are increasingly wary of committing capital, thereby hindering economic growth and prospects for recovery.
“The combined effect of these is the resultant higher inflationary pressure, which fuels the cost of production, reducing consumers’ purchasing power and having a greater impact on the manufacturers.”