ECONOMIC TRANSFORMATION: FUNDING AS A CATALYST FOR SUSTAINABLE SMES IN ENUGU STATE, NIGERIA
Keywords:
Nigeria, youth unemployment, small and medium scale enterprises (SMEs),, employmentAbstract
Nigeria, a country rich in potential investments, business opportunities, and abundant human and natural resources, is grappling with a persistent challenge of high youth unemployment. Despite these invaluable resources, the unemployment rate among Nigerian youths has been soaring, as highlighted by the National Bureau of Statistics (2021) report. The unemployment rate escalated from 27.1% in the second quarter of 2020 to a staggering 33.3% by the end of 2020, and this alarming trend likely continued into 2022. The adverse impact of the COVID-19 pandemic on employment exacerbates the unemployment crisis, with countless individuals being laid off. The gravity of the situation is further underscored by the observation of Okorie and Ibegbulem (2014) that a substantial number of graduates, approximately four million annually, join Nigeria's labor market, compounding the challenge of unemployment. This crisis in unemployment poses a severe threat to the stability of Nigerian society. Addressing this issue requires urgent exploration of viable employment avenues, among which the development of small and medium scale enterprises (SMEs) stands out. SMEs have been defined and understood from various perspectives. The Nigerian industrial policy cited by Okonkwo and Obidike (2016) classifies SMEs based on total investments, while Gbandi and Amissah (2014) link SMEs to asset base and labor force size. Furthermore, the Central Bank of Nigeria (2010) characterizes SMEs in terms of asset base and employee count. Ibrahim (2011) takes a broader approach, encompassing SMEs as businesses excluding public limited liability companies, suggesting that even enterprises with capital less than N5 million can be classified as SMEs. Additionally, the American Small Business Administration (SBA) definition, as highlighted by Ajayi (2016), emphasizes independent ownership and operation, encompassing small-capital businesses such as street-side shops. This study aims to critically analyze the role of SMEs in mitigating Nigeria's unemployment crisis. By delving into the distinctive definitions and perceptions of SMEs, this research seeks to shed light on the potential of small and medium enterprises to not only drive economic growth but also alleviate the pressing issue of youth unemployment. Through comprehensive exploration and analysis, this study contributes to the ongoing discourse on employment strategies in the Nigerian context
Published
How to Cite
Issue
Section
Copyright (c) 2023 International Journal of Interdisciplinary Research in Marketing and Management (IJIRMM)
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
References
Adebisi, S. A., Gloria, C. A., Aiwanehi, B. O. (2015).Challenges of finance and the performanceof small and medium enterprises (SMEs) in Lagos State. Developing Country Studies 5(8): 46–57.
Adjei, H., Anokye, O. A. C., Mintah, E. K. & Offeh, M. C. (2014). Assessing Financial Reporting Practices among Small Scale Enterprises in Kumasi Metropolitan Assembly. European Journal of Business and Social Sciences, 2(10).
Afolabi, A., & Oyeyipo, O. (2017). The perception of future decision makers on the building profession. Malaysian Construction Research Journal, 21(1), 55-73.
Ajanthan, D. (2017). The role of a social media marketing in building brand equity- A special reference to travel & tourism industry in Sri Lanka. Global Journal of Management and Business Research, 17(3), 31-37.
Ajayi, N. (2016). Impact of external business environment on the organizational performance of small and medium scale enterprises in Ogun State, Nigeria. International Journal of Business policy and governance 3(10); 155-166.
Alkali, M., & Isa, A. H. (2012). Assessing the influence of external environmental factors on the performance of small business manufacturing enterprises in Bauchi State, Nigeria. Interdisciplinary Journal of Contemporary research in Business,4(7), 621-628.
Anyadike, N., Emeh, I., & Ukah, F. O. (2012). Entrepreneurship development and employment generation in Nigeria: Problems and Prospects. Universal Journal of Education and General Studies, 1(4), 88-102.
Aremu, M. A. (2013). Small and Medium Scale Enterprises As A Means of Employment
Generation and Capacity Building in Nigeria. A Paper Presented at the International Conference on Management and Enterprise Development on “Intellectuals and New Strategies for Sustainability Development of the Third World” Held at Conference Center, University of Ibadan, Ibadan, Nigeria, October 5th - 8th.
Babandi I. G. (2017). Strategizing for Sustaining Small Business Enterprises in Nigeria. International Journal of Business and Management (IOSR-JBM), 19 (10), 8-25.
CBN (2010). Guidelines for N200 Billion SME Credit Guarantee. Abuja: Development Finance Department, Central Bank of Nigeria.
Christopher, E. & Adepoju, A. (2012). Strategies for developing small and medium scale enterprises in Nigeria for global competitiveness. E3 Journal of Business Management and Economics 3(7) 266-274.
Ekpo. I. K. (2015). Small scale industries in Nigeria: Concepts, appraisal of government policies and suggested solutions to identified problems. Economic and Financial Review. 24, (4) 123-143.
Evans, D. S. & Jovanovic, B. (1989). An estimated model of entrepreneurial choice under liquidity constraints, The Journal of Political Economy 97(4), 808-827.
Ezema, M. C. (2014). Small and Medium Scale Enterprises in Nigeria: problems and prospects. A project presented to the department of management, Faculty of business administration University of Nigeria Enugu campus.
Fatoki, O. (2014). The financing options for new small and medium enterprises in South Africa. Mediterranean Journal of Social Sciences, 5, 748-755.
Freedman, L. (2013). Strategy. Oxford University Press.
Gbandi, E. C. & Amissah, G. (2014). Financing options for Small and Medium Enterprises (SMEs) in Nigeria. European Scientific Journal, 10 (1), 327-340.
Golić, Z. (2014). Advantages of crowd-funding as an alternative source of financing of small and medium-sized enterprises. Proceedings of the Faculty of Economics in East Sarajevo, 8, 39-48.
Gudov, A. (2013). Combining formal and informal financial sources Russian early entrepreneurs’ and established firms’ structure of external financing. Journal of Chinese Entrepreneurship, 5(6), 39-60
Hoque, M. Z., Sultana, N., & Thalil, T. (2016). Credit rationing’s determinants of small and medium enterprises (SMEs) in Chittagong, Bangladesh. Journal of Global Entrepreneurship Research, 6(1), 1-23.
Ibrahim, A. B. (2011). Entrepreneurship and small business management. Text Reading and Cases. Kendall/Hunt Publishers. 345-367.
Iwala, O. S. (2014). Achieving Sustainable Poverty Reduction and Rural Development in Nigeria through Local and Economic Development Strategies. American Journal of Rural Development, 2 (1):13-19.
Iwuoha, J. P. (2020) Guaranteed ways to raise the capital you need to start up and grow your small business. https://www.smallstarter.com/get-inspired/how-to-get-capital-to-start-your-small-business/
Justin, I. I. (2014). Evaluation of survival strategies of small and medium enterprises in Benue State, Nigeria. International Journal of Academic Research in Accounting, Finance and Management Sciences 4(2)255–263.
Kerr, W. R., Lerner, J., & Schoar, A. (2014). The consequences of entrepreneurial finance: Evidence from angel financings. Review of Financial Studies, 27 (2), 20-55.
Mamman, A. & Aminu, K.S. (2013). Effect of 2004 Banking Reforms on Loan Financing of Small and Medium Scale Industries in Nigeria. International Journal of Small Business and Entrepreneurship Research, 1(3), 44-53.
National Bureau of Statistics (2019). Unemployment Rate in Nigeria. https://dailypost.ng/2019/05/02/nigerias-unemployment-rate-reach-33-5-percent-2020/ February 2021: 2:00PM
National Bureau of Statistics (2021). Nigeria Unemployment Rate in 2021 https://www.proshareng.com/news/Nigeria%20Economy/Nigeria-s-Unemployment-Rate-Increases-to-33.3Percent-in-Q4-2020-from-27.1Percent-in-Q2-2020---NBS/56302. August 5 2021: 7:00PM
Nnadi, J. C. (2014), Entrepreneurship Development and its Impact on Small Scale Business Enterprises in Developing Countries: A Nigerian Experience. Journal of Entrepreneurship & Organization Management, 3 (2), 1- 8.
Okonkwo, N. O. & Obidike, C. P. (2016) Small and Medium Scale Enterprises Financing In Nigeria: Problems and Prospects. International Journal of Innovative Social Sciences & Humanities Research, 4(1), 77-86,
Okorie, B. O. & Ibegbulem E. E. (2014). Small and medium scale business enterprises as a veritable tool for rural development in Nigeria: Challenges And Prospects. Journals of Educational Policy and Entrepreneurial Research, 3(3)86-90.
Onwuchekwa F. (2017). Small and Medium Scale Enterprises (SMES) and Industrial Development of Onitsha Metropolis: A Cluster Lead Approach. International Journal of Economics and Business Management of International Institute of Academic Research and Development, 3 (10), 64- 90
Prasad, L. M. (2012). "Business Policy: Strategic Management ", Sultan Chand & Sons, New Delhi.
Rafiat, A. A. & Ejededawe O. A. (2015) Commercial Banks Role In Financing Small Scale Industries In Nigeria (A Study Of First Bank, Ado-Ekiti, Ekiti State) European Journal of Accounting, Auditing and Finance Research, 3 (8), 52-69.
Richards, C. (2017). Core business strategies. Retrieved from http://smallbusiness.chron.com.
Ukpong, O. U. & Eyo, E. T. (2016). Techniques for Re-Positioning Small and Medium Scale Business Enterprises in Nigeria for Economy Revitalization. International Journal of Business and Management Review, 4 (7), 1-7.
World Population Review. (2019). Nigeria population 2019. Retrieved from http://worldpopulationreview.com/countries/nigeria-population/Google Scholar
