The Central Bank of Nigeria (CBN) has released its July 2024 Business Expectations Survey (BES) report, which offers insightful information about the current standpoint and future prospects of businesses in the nation’s numerous sectors. As per the report, businesses are optimistic about their expansion plans, implying job opportunities are expected to rise across a variety of sectors. A sample of 1,600 business organizations nationwide participated in the survey which was conducted between July 15 and July 19 and had a response rate of 98.9%. Various sectors including agriculture, manufacturing, construction, gas, and water supply, Mining and quarrying, and Electricity were covered in the survey.
With indices at 14.4 and 8.1 points, businesses are especially confident about the number of business activity and employment forecast in August 2024, based on the research. These numbers point to possible job growth, which would stabilize the Economy and create opportunities in a number of fields. Respondents said they were confident in growing their business across all industries in August. Notably, with a growth forecast of 66.9 percent, the Agriculture industry demonstrated the most significant potential for increase.
Agriculture leads in positive employment forecasts.
Other sectors followed with a growth rate of 56.3 percent for construction, 55.2 percent for market services, 50.9 percent for non-market services, 30.0 percent for mining & quarrying and 44.3% for manufacturing. With a sectoral employment outlook score of 14.5 points, agriculture leads the way in the positive employment forecast across all sectors, which is consistent with the expansionary trend. Following closely at 13.9 points is the Construction industry which is anticipated to generate more jobs. While mining and quarrying has 11.8 points, Manufacturing has 6.0 points, non-market services has 5.8 points and market services has 5.8 points.
However, the poll also identified some major difficulties that firms experienced this month, with Insecurity coming in first on the list. Additional obstacles that were cited as barriers to corporate expansion included high interest rates, inadequate power supplies, various high taxes, and problems with extortion and corruption. Notwithstanding current obstacles, the CBN survey’s positive view about firms looking to expand portends favorably for the country’s economy, with employment growth and Economic Stability on the road ahead.
Respondents in the South West expressed pessimism.
Furthermore, the BES report’s conclusions point to a cautiously positive future for Nigerian companies. Even while issues like Inflation and currency rate Volatility still exist, general consensus suggests a gradual recovery and expansion of the economy. Government policies, the state of the global economy, and the fixation of domestic issues like insecurity and infrastructural deficiencies will all have an impact on how far this recovery goes. The majority of respondents anticipate modest Economic Growth in the upcoming months, fueled by more investment, better infrastructure, and governmental initiatives.
Industry-specific differences in confidence level were evident, with some showing more optimism than others. The study brought to light differing assumptions about employment. Some companies want to expand their workforce. Some companies want to expand their workforce, while others are being cautious because of the state of the economy and growing operating expenses. With an overall Confidence Index of 23.6 points, respondents in the North East Zone expressed optimism about business operations during the month under review. Meanwhile, respondents in the South West Zone expressed pessimism over business activities during the reviewed month with the overall Confidence Index reading -1.5 index points,
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Businesses that are neither importers nor exporters and “importers” were the most gloomy business outlook categories, scoring -4.5 and -2.0 points, respectively. In July 2024, respondents’ confidence index regarding their own operations were negative in all sectors. Based on their respective indices of -22.6, -16.5, -4.8, and 13.7 points, respondent firms anticipate that the Naira would depreciate in the current month, next month, and the following three months, but appreciate in the following six months. They also anticipate an increase in borrowing rates.