Government Socio-economic Expenditures, Lending Interest Rate and Oil Revenue as Determinants of Industrial Labour Force Dynamics in Nigeria

Unemployment as an integral aspect of the labour force remains a pressing challenge in Nigeria and thus, requires an in-depth examination of its determinants. This study investigated government health and economic services expenditures, lending interest rate and oil revenue as determinants of unemployment in the country. It utilized data spanning 2000-2020 from the World Bank and the Central Bank Statistical Bulletin on annual socio-economic outlook. An ex-post facto research design was employed, and the author conducted diagnostic statistical tests to ensure adherence to the assumptions necessary for Ordinary Least Square (OLS) regression analysis after which, Robust Least Squares (RLS) regression was adopted to estimate the model and test the hypotheses at 5% level of Significance. The results indicated Domestic Government General Health Expenditure as % of Government Health Expenditure (DGGHECH) did not have a significant relationship (-0.062833; p = 0.4821) with Total Unemployment (TU). Meanwhile, Federal Government Capital Expenditure on Economic Services (FGCEES) had a significant negative relationship (-0.006217; p = 0.0005) with TU.  Lending Interest Rate (LIR) showed no significant association (-0.299545; p = 0.1345) with TU. Oil Revenue (OR) had a significant negative relationship (-0.000613; p = 0.0045) with total unemployment for the period under review. In conclusion, the study provided valuable insights for policymakers in understanding the factors that impact unemployment rates in Nigeria by emphasizing the importance of government investment in economic services and the influence of oil revenue on the total employment level in the country.