Let’s face it.
The tech ecosystem is a major boon for the Nigerian economy, even if our policymakers have not yet caught on.
For starters, the ability of high-growth startups to create high-paying jobs goes a long way in solving one of the most pressing socio-economic issues facing the country today. Our latest unemployment figures show that Nigerian job seekers are currently facing the worst unemployment crisis in decades.
Since 2020, African startups have been fundraising faster than ever. And so, many expect that African tech talent should start earning the same wages as their foreign counterparts.
However, economic theories teach us that wage differentials across regions are determined by other things such as the quality of outside options and productivity.
Ultimately, to ensure African founders continue to attract quality talent that will allow them to innovate at scale, founders must invest in building a talent pipeline, which will benefit all actors in the ecosystem in the long run.
In the last seven years, we have been running an annual job deficit of over 2.5 million. The most recent job creation numbers from the National Bureau of Statistics show that just over 420,000 jobs were created in 2015. That’s what makes today’s startups so valuable. They don’t just create jobs for now but also in the future because they are engineered to grow quickly and oftentimes, expansion means employing more people.
According to this Medium post, startups who are fresh from raising successful seed rounds and are looking to scale will have their sights set on expanding their team of 10 developers to 20. Those who are beyond the seed stage would be thinking of going from 20 to 50 developers. In mature startups like Paga & Flutterwave, the workforce can expand beyond 400+ employees.
This makes the startup ecosystem a powerful tool for job creation. Data from the United States shows that startups accounted for nearly all net job creation over