Impact Of Government Expenditure On Unemployment In Nigeria

Abstract

Despite rising government expenditure over the years, unemployment remains high and persistent. This study examines the impact of government   expenditure   on unemployment in Nigeria over a period of 1981 to 2023. An autoregressive distributed lag (ARDL) model was utilized for the analysis. Major findings indicate that general government expenditure has a negative effect on unemployment in the long run while final consumption expenditure has a negative but weak impact on unemployment in Nigeria. Furthermore, the short-run results indicate that past periods of gross national expenditure decrease current unemployment while general government expenditure increase current unemployment. The study concludes that government expenditure is an effective tool for reducing unemployment in Nigeria and The government should implement targeted job creation programs in high impact sectors like infrastructure and social services, alongside strict anti-corruption measures to ensure transparent and efficient allocation of public funds.