‘How Nigerian Businesses Fared During 2020 COVID-19 Pandemic’
Not less than 20 percent of full-time workforce in Nigeria lost employment during the COVID-19 pandemic in 2020, according to a new report jointly released by the United Nations Development Programme and the National Bureau of Statistics.
The report is titled, The Impact of COVID-19 on Business Enterprises in Nigeria.
The report was based on in-depth interviews with about 3,000 businesses in the formal and informal sectors across major industries of the economy and assessed the impact of COVID-19 on business enterprises across Nigeria.
The report states that, “While there have been promising signs of recovery this year, COVID-19 has had an outsized socio-economic impact on Nigeria.
“From disruptions in supply chains to ongoing supply and demand shocks and a drop in consumer confidence, these challenges are expected to leave a lasting impact on the businesses and enterprises that make up the backbone of the economy.”
It highlighted the significant decline in revenue faced by enterprises and establishments across the country due to the pandemic, indicating that 81 percent of enterprises that were interviewed experienced a decline in revenue, while 73 per cent stated that they faced liquidity challenges due to secondary impacts of the pandemic in 2020.
Data from the report showed that the median loss in revenue remained at 44 percent, in comparison to 2019 revenues; while about 60 per cent of enterprises surveyed experienced an increase in operational costs, with the price of raw materials and logistics being the top two contributors to the increase.
Other operational challenges included access to credit and capital, high expenditure on utilities, and inadequate social safety net, especially for informal enterprises.
In addition, the report revealed that one in three business enterprises surveyed indicated that some businesses have permanently closed due to operational challenges resulting from the pandemic.
In his remarks, the Statistician-General of the Federation, Dr. Simon Harry, said, “As the economy begins to show signs of gradual growth, this report contains important information that can guide policy makers in their interventions to mitigate the negative socioeconomic impacts of COVID-19 in the country.
“I wish to thank UNDP for collaborating with the National Bureau of Statistics on this important report and I urge other development partners to emulate this worthy endeavour by partnering with the Bureau in matters relating to data generation in the country.
“Although the report findings highlight the complex challenges the economy continues to face because of COVID-19, it also tells a powerful story of innovation, resilience, and strength as Nigerian businesses leverage their ingenuity to adjust to this new normal.”
UNDP Resident Representative, Mr. Mohamed Yahya, said, “As Nigeria mobilises to recover from the devastating health and socio-economic impact of the pandemic, this report will be a critical tool in informing targeted policymaking and programme interventions for both medium and long-term planning as the country rebuilds.”
According to the report, businesses are likely to continue experiencing the impact of the pandemic even after the easing of public health measures.
Despite reduced restrictions at the time of the interviews, 74 per cent of enterprises still reported a decrease in production levels when compared to the same time in 2019.