Emigration and labour market dynamics in Nigeria

Ebenezer Olubiyi, Federal University of Agriculture, Abeokuta
Omolola Olarinde, Elizade University

The Nigerian labour market is fraught with high rate of unemployment and sluggish wage adjustment, not explicitly determined by market forces. Wages respond sluggishly to inflation rate, worsening workers’ welfare. These and other reasons create push effects for youth emigration from Nigeria. This paper provides empirical evidence on the labour market effects of emigration from Nigeria. A neoclassical migration theory that is similar to the Stolper-Samuelson factor price equalization outcome was employed, using generalized method of moments to estimate the coefficients. Results show emigration of highly skilled workers leads to increase in high and low skilled wage with the former preponderant. Rising wages are accompanied by increase in unemployment. Emigration of low skilled workers increases low skill wage, decreases unemployment but has no wage effect on high skilled workers. Nigeria should retain highly skilled workers while channeling remittances to productive use.