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A composite index of leading indicators of unemployment in Nigeria

Author

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  • Moses Tule
  • Taiwo Ajilore
  • Godday Ebuh

Abstract

The study computes a composite index of leading indicators of the unemployment rate in Nigeria following the Organization for Economic Co-operation and Development (OECD) system of composite leading indicators methodology as enunciated in Gyomai and Guidetti (2012). Prediction is based on the analysis of multiple series covering diverse aspects of economic activity, which have a leading relationship to unemployment. The leading properties were determined by their cross-correlation structure and Granger Causality analyses. Once selected, the series were aggregated into single composite indicator based on the outcomes of the cross-correlation and Granger Causality estimations. The results from both the cross-correlation and Granger Causality based composite indexes provide accurate tracking of the unemployment turning points in Nigeria over a 7-year period (2008–14).

Suggested Citation

  • Moses Tule & Taiwo Ajilore & Godday Ebuh, 2016. "A composite index of leading indicators of unemployment in Nigeria," Journal of African Business, Taylor & Francis Journals, vol. 17(1), pages 87-105, January.
    • Handle: RePEc:taf:wjabxx:v:17:y:2016:i:1:p:87-105
    DOI: 10.1080/15228916.2016.1113909
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    References listed on IDEAS

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    1. Pablo Galaso & Sandra Rodriguez, 2014. "A composite leading cycle indicator for Uruguay," Documentos de Trabajo (working papers) 14-09, Instituto de Economía - IECON.
    2. Meltem Gulenay Chadwick & Gonul Sengul, 2015. "Nowcasting the Unemployment Rate in Turkey : Let's ask Google," Central Bank Review, Research and Monetary Policy Department, Central Bank of the Republic of Turkey, vol. 15(3), pages 15-40.
    3. Edda Claus, "undated". "Constructing NEO: A Near-term Employment Outlook," Working Papers-Department of Finance Canada 2001-07, Department of Finance Canada.
    4. Marcel, Mario., 1990. "Leading indicators for employment forecasting in developing countries," ILO Working Papers 992788013402676, International Labour Organization.
    5. repec:ilo:ilowps:278801 is not listed on IDEAS
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    Cited by:

    1. Jeerawadee Pumjaroen & Preecha Vichitthamaros & Yuthana Sethapramote, 2020. "Forecasting Economic Cycle with a Structural Equation Model: Evidence from Thailand," International Journal of Economics and Financial Issues, Econjournals, vol. 10(3), pages 47-57.
    2. K. Moses Tule & Eunice Ngozi Egbuna & Eme Dada & Godday Uwawunkonye Ebuh, 2017. "A dynamic fragmentation of the misery index in Nigeria," Cogent Economics & Finance, Taylor & Francis Journals, vol. 5(1), pages 1336295-133, January.
    3. Ebuh U. Godday & Nuruddeen Usman & Afees A. Salisu, 2022. "Testing for unemployment persistence in Nigeria," Economic Change and Restructuring, Springer, vol. 55(4), pages 2605-2630, November.

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