Again, Nigeria performed poorly in the recent World Bank Human Capital Development Index report. In the report titled: “COVID-19 and the Human Capital Crisis in Nigeria”, the World Bank notes that any success of Nigeria’s poverty reduction program, which aims to reduce poverty at the rate of 10 million a year, must depend on the elaboration of the human development index. (HDI). Unfortunately, these objectives will probably not be achieved despite the government’s promises. The report also says that poverty has undermined a significant portion of the Nigerian population and that even “the ability of ten-year-olds to understand a simple sentence or perform basic numeracy tasks” has become a matter of concern.
Although the situation predates the pandemic, it is stifling the development of Nigeria’s human capital. About 70% of children in low- and middle-income countries fall into this poverty pit. Available statistics indicate that Nigeria is in steep decline in human capital development, a key element the country needs to catch up with other developing economies in the world.
According to the Human Capital Index (ICH) 2020, a child born in Nigeria during the time of the pandemic is likely to reach only 36% of the productivity level. This figure is lower than the average for sub-Saharan Africa, estimated at 40%. Only six countries have lowered HCI scores globally.
The report concludes that the direct health effects of the COVID-19 pandemic could threaten the future generation of Nigerian children through its impact on education, exacerbated by frequent school closures, low attendance rates, even after reopening. Insecurity across the country has led to the closure of some public and private schools.
The ongoing strike by university professors has closed public universities for more than five months. Now is not the time to play politics with the development of our human capital, which is already in steep decline.
It is a sad development that Nigeria is at the bottom of major global rankings, including the most recent Global Innovation Index report. Regarding the low development of human capital, there is an urgent need to address the state of our public institutions. The neglect of this essential component of human capital development has affected the quality of leadership in the country.
Lack of leadership remains one of Nigeria’s major development challenges. Henceforth, let the government pay urgent attention to the development of human capital. In a knowledge-based economy, young Nigerians should be acquainted with the skills, competencies, training and experience required to compete favorably with their counterparts around the world.
Huge investments in human capital development will strengthen the development of the country. Unfortunately, Nigeria has not performed well in the Global Human Development Index. In 2018, Nigeria ranked 152nd out of 157 countries surveyed by the World Bank in its first Human Capital Development Index.
In that year’s report, the Bank noted that Nigeria was in the “red zone” because its budget for education and health was too small to have the required impact. Moreover, in 2020 when the pandemic broke out, Nigeria recorded an abysmal 0.30 points in the World Bank’s Human Capital Development Index. This represents 0.01 basis point against 0.38 point recorded in 2019. Last year, Nigeria ranked 102nd out of 104 countries surveyed on good governance, a critical element related to human capital development. Nigeria was only better than Zimbabwe and Venezuela.
In other words, Nigeria is the third worst country in the global human capital development index. Indicators used to arrive at the ranking include: leadership and foresight, strong laws and policies, and strong institutions. The rest is financial management, attractive market or ease of doing business, global influence and reputation, and the country’s ability to help develop its future leaders. Unfortunately, successive governments in the country have not done so well in these key areas. Nigeria needs to invest heavily in human capital development to achieve impressive growth. According to the United Nations Development Program (UNDP), human capital is an active factor that drives economic growth in every nation. The assessment reflects the reality of the Nigerian situation.
Nigeria’s budgetary allocation to education has not been impressive. In 2020, Education got N671.07 billion or 6.7%; N771.5 billion or 5.8% in 2021; and N1.29 trillion or 7.9% in 2022. There is no indication that it will improve now. For Nigeria to perform well in the Human Capital Development Index, the government should increase its annual budgetary allocations to the education and health sectors.
At the same time, entrepreneurship education should be a compulsory course in our higher education institutions in order to prepare young graduates for a future that does not depend on white-collar jobs.