Businesses that have their asset base, revenues, or their number of employees fall below a certain figure are referred to as Small and Medium-sized Enterprises. This figure usually varies from country to country due to the country’s economic structure.
Read more about Business
The major approach for the establishment of SMEs and their promotion by different sectors is to increase job creation, promote economic development, as well as reduce poverty.
SMEs are known to be independent commercial entities managed solely by the owners, and they play major roles in empowering the youths of Nigeria. These enterprises range from Media companies to Consulting companies and so much more.
Some ways SME development affects youth empowerment in Nigeria include;
-
Generation of Employment for youths
Most recent statistics shows that SMEs account for over 90% of businesses and 84% of employment in Nigeria. That’s quite amazing, isn’t it? The fact that the SME sector in Nigeria is strategically positioned to absorb up to 80 percent of jobs. The SME sector is no doubt the largest provider of employment in Nigeria, especially for new jobs. In fact, more jobs are created by SMEs than large scale enterprises. SMEs are therefore, the bedrock upon which employment generation and poverty reduction thrive.
-
Improves the standard of living
Asides poverty reduction, SMEs also help to enhance the standard of living, most especially for the youths in rural areas. A lot of SMEs are located in rural areas, due to the fact that they can survive on already existing basic industrial infrastructure.
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Consequently, they act as main facilitators for industrial dispersal and development of rural areas, as they help in the mitigation of the rural-urban drift. Kogi State, for example, has the Dangote Cement factory at Obajana, which attracted the establishment of some SMEs to the area. Such SMEs, to a large extent, have now addressed the problem of youths being very idle, by increasing employment rates in such rural areas. Most often, SMEs are the only source of employment, as well as income among the rural poor and low-income earners.
- The benefit of starting small
One important advantage of an SME is that you do not need to break the bank to start. Due to the low take-off capital requirement, more youths are now able to start-up SMEs as compared to large scale enterprises. The scope for the involvement of individuals with limited capital in industrial activities is now expanded. Generally, SMEs at first could use primarily internal funds from families and friends, but eventually require external funding to grow. And this is required to invest, acquire new technology and therefore, increase productivity to help them expand and get to compete with regional or global markets.
Youth empowerment is a global phenomenon, and also one of the biggest challenges currently being faced by all the developing countries of the world. The history of the industrial revolution in developing economies or countries like Nigeria has shown that SMEs are a strong pushing force of industrial development. It is therefore, imperative for the government to focus on supporting and funding the activities of SMEs. Hence, youth empowerment, especially through the intentional involvement in Small and Medium Scale related businesses. This have now become inevitable in Nigeria, because of its numerous benefits.
Featured Image Source: The Guardian NG
Got a suggestion? Contact us: editor@connectnigeria.com
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This article was first published on 9th December 2021
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Grace Christos Is a content creator with a proven track record of success in content marketing, online reputation management, sales strategy, and so much more.
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