FINANCIAL SECTOR DEVELOPMENT, POPULATION GROWTH AND EMPLOYMENT

Abstract

This study investigates financial sector development, population growth and employment in Nigeria using empirical analysis. The study adopted time series data from Central Bank of Nigeria Statistical Bulletin covering 1995 to 2021, The data was aggregated and analysed using E-view 8,. Descriptive statistics of the individual variable was run with preliminary analysis of Heteroskedasticity using Serial Correlation Tests. The error correction technique was adopted, which revealed that population growth has negative insignificant relationship with employment in Nigeria. The result also shows that financial sector development has negative relationship with employment in Nigeria. The study recommends that the country's level of financial development is still at a low level compared to that of emerging and developed countries. Against this backdrop, it is important to take steps to enable the financial sector, especially depository banks and microfinance banks, to act as effective lenders to large and small businesses respectively. Relevant authorities, especially the Central Bank of Nigeria, should further strengthen proper supervision and oversight of the activities of financial market players. In particular, authorities should monitor the nature of lending by deposit-taking banks and the investment operations conducted by financial market participants. This prevents lending to unscrupulous investors and the accumulation of bad debts. We also need to take steps to further deepen the financial sector. This will allow the sector to direct its free credit towards financially stressed sectors of the economy.