Speaking at the 2025 WorldStage Economic Summit (WES) on Friday, Dr. Adegboye highlighted the stark gap between Nigeria’s potential and its current economic output, framing the country’s productivity challenge as both “a human tragedy and a defining opportunity.” He urged that political will, private sector leadership, and coordinated policy interventions could help Nigeria harness its demographic dividend, leverage technology, and reverse decades of economic stagnation.
A Widening Productivity Gap
Dr. Adegboye presented sobering statistics that underscore the scale of Nigeria’s productivity dilemma. In 2024, Nigeria’s GDP per worker stood at $11,800—well below the global average of $49,000. Productivity growth, which averaged just 1.25% between 1990 and 2024, has slowed to a mere 0.22% since 2010, far short of the 3.5% required to absorb 3.5 million new labor market entrants annually.
The average Nigerian worker earns roughly $7 per hour, compared with $30 in South Africa, representing only 7% of the global average productivity level. Despite being Africa’s largest economy by population, with over 60% under the age of 25, Nigeria remains constrained by inefficiency and structural stagnation.
Dr. Adegboye noted the paradox vividly: 40% of Nigerians work in agriculture yet cannot feed the country’s 230 million population, while just 2% of U.S. farmers feed over 350 million Americans. As a result, 63% of Nigerians, or roughly 133 million people, live in multidimensional poverty.
Sectoral Productivity Imbalances
Nigeria’s productivity challenge is uneven across sectors. Agriculture employs 40% of the workforce but contributes only 22% to GDP, making it the least productive sector. Manufacturing has stagnated at around 12% of GDP for decades, while the services sector—accounting for over 50% of GDP—is dominated by informal, low-productivity activities. Only 20% of service sector workers are in formal, high-productivity jobs.
Dr. Adegboye emphasized that productivity is central to long-term economic well-being. It drives structural transformation, poverty reduction, real wage growth, and the capacity to absorb millions of young job seekers annually. The economic cost of low productivity is significant: Nigeria foregoes $4–6 billion in potential GDP annually, formal sector real wages have fallen 40% since 2019, youth unemployment stands at 15.2%, and each 1% shortfall in productivity erodes 0.5% of fiscal revenues.
Drivers of Productivity and Key Challenges
Several critical factors underpin Nigeria’s productivity performance. Dr. Adegboye highlighted innovation, infrastructure, physical capital, human capital, health, demographics, and institutional quality. Current deficits are stark:
- Innovation: R&D spending is only 0.2–0.3% of GDP, versus 1–2% among peer countries.
- Physical Capital: Power outages cost the economy $29 billion annually (6% of GDP).
- Infrastructure: Logistics costs average 40% of product value, four times the global average.
- Human Capital: Only 10–12% of the workforce has tertiary education.
- Health: Nigeria’s Human Capital Index stands at 0.36, indicating children reach just 36% of their potential.
- Institutions & Governance: Weak rule of law, corruption, and macroeconomic volatility deter investment.
- Gender & Inclusion: Women constitute 70% of informal workers, limiting productivity gains.
A Roadmap to Productivity Growth
Dr. Adegboye proposed a comprehensive policy framework to address these structural bottlenecks. Key recommendations included:
- Economic Diversification: Moving beyond oil by promoting agro-processing, light manufacturing, and digital services, and leveraging the AfCFTA for regional trade expansion.
- Infrastructure Investment: Upgrading the power grid, integrating renewable energy, investing $10 billion in roads, rail, and ports, and reducing logistics costs from 40% to 15% of product value.
- Human Capital Development: Training 10 million youth in vocational and digital skills by 2030, expanding health interventions, and fostering diaspora knowledge transfer.
- Technology and Innovation: Expanding tax incentives for startups, scaling digital tools for agriculture and manufacturing, and upgrading university innovation clusters.
- Financial Access and Inclusion: Targeting women and youth entrepreneurs through blended finance, expanding fintech lending, and easing collateral and interest barriers.
- Agricultural Modernization: Establishing agro-industrial processing zones and increasing productivity by 15–20% to reduce food insecurity and create jobs.
- Inclusive Growth: Promoting gender equality in land and credit access, climate-resilient agricultural investment, social protection measures, and narrowing urban-rural productivity gaps.
Dr. Adegboye concluded that addressing Nigeria’s productivity challenge is not merely an economic imperative but a societal one. With coordinated policy action and targeted investments, he argued, the country could transform its demographic potential into shared prosperity and secure its position as a regional economic leader.
“The challenge of low productivity in Nigeria is far-reaching in terms its causes and implications. The persistent productivity crisis therefore represents both a major developmental hurdle and a defining opportunity for structural transformation. As this study documents, the nation’s vast human and natural resource endowments have been stymied by structural constraints, sectoral inefficiencies and lagging innovation. These have resulted in historically low output per worker and slow poverty reduction efforts despite episodic GDP growth. Central to these challenges is a pattern of misallocated capital, weak infrastructure, skills mismatch and institutional fragility that perpetuates deep segmentations in the economy.
“The findings from the study highlight that sustainable economic advancement for Nigeria must be anchored on wide-ranging productivity reforms. Real change towards tackling low productivity in the country demands coherent strategies that combine short-term stabilisation measures with long-term investments. Specifically, investment must target human capital, technological capacity and supportive institutional frameworks. Policies to broaden sectoral diversification are also vital to absorbing the expanding youth workforce into productive and higher-income employment. Thus, critical steps in the productivity drive must include upgrading of infrastructure, advancing digital penetration, scaling quality of education thorugh skill-building, promoting inclusive policies for women and vulnerable groups and fostering pro-competitive regulatory environments that incentivise innovation and formalisation.
“Ultimately, the future trajectory of aggregate productivity growth in Nigeria depends on forging a strong consensus around the productivity agenda as the foundation for shared prosperity, social inclusion and long-term economic resilience. Without substantive shifts, especially in education quality, energy supply, financial access and governance efficacy, GDP expansion will remain hollow and millions risk being left behind in the growth process. If Nigeria leverages its demographic dividend and harnesses technological change it can decisively reverse the current productivity malaise, reduce poverty and chart a path toward middle-income status and regional economic leadership.”
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| L-R: Dr Abidemi Cornelius Adegboye, Department of Economics, University of Lagos; Mr Adeniran Adebayo, representing Mr. Olanipekun Olukoyede, Executive Chairman, Economic and Financial Crimes Commission (EFCC); and Mr Segun Adeleye, President/CEO, World Stage Limited at WorldStage Economic Summit 2025 at the Event Centre, Nigeria Exchnage Limited, Lagos on November 21, 2025. |
The Guest Speaker, Abidemi Cornelius Adegboye holds a Master of Science (M.Sc.) degree in Economics—graduating with distinction as the best student in 2012—from the University of Benin, Nigeria. He later earned his Ph.D. in Development Economics from the same institution in 2018.
Dr. Adegboye is a research scholar affiliated with the African Economic Research Consortiu (Kenya) and the African Research Universities Alliance (ARUA), Ghana. His research interests span poverty and inequality, employment and labour markets, and structural transformation across sub-Saharan Africa.
He has presented his work at numerous local and international conferences and has published extensively in reputable journals. In 2020, he received the Nigerian Economic Society’s award for Best Ph.D. Thesis. His paper on governance and employment in sub-Saharan Africa also won the Best Research Paper Award at the 2017 African Economic Conference, jointly organised by the AfDB, ECA, and UNDP in Addis Ababa.
Beyond academia, Dr. Adegboye has undertaken consultancy assignments for the National Institute of Legislative and Democratic Studies (NILDS), Abuja; the Lagos State Government; the United Nations Economic Commission for Africa (UNECA); and the African Development Bank (AfDB). He currently lectures in Development Economics and Macroeconomics in the Department of Economics at the University of Lagos.