Education enrolment rate vs employment rate: Implications for sustainable human capital development in Nigeria

Purpose: The study examines the dynamic interrelationships among the school enrolment rates and the rate of employment (via unemployment rates) in Nigeria. Design/methodology/approach: The study employed Autoregressive estimates and an unrestricted VAR approach to analyze these relationships. Findings: The study lends credence to the new-growth theory (i.e. endogenous models) that more investments in human capital, through education especially at higher levels, will allow human capital to evolve dynamically to increase long-run growth positively in Nigeria. This tendency engenders multiplier effects in stimulating sustainable human capital development given that education-driven growth facilitates employment in the short-run. However, to sufficiently sustain human capital development to generate employment in the long-run, it appears there is need to combine education with other cooperant factors such as social safety nets, good governance, private sector development and efficient utilization of human and physical resources. Originality/value: The growth literature has been definitive on the role of human capital in achieving long-run economic growth. Therefore, investments in education have been identified as a vital channel for building human capital and achieving long run development objectives. Thus, in the nascent quest for sustainable development, this study takes the new growth theory a step higher by examining the modulating effects of education-driven growth (i.e. via school enrolments rates) in setting the pace for employment patterns in Nigeria.