I just saw a news article that the Ekiti state Governor Kayode Fayemi conducted a survey and discovered that 250,000 youths in his state were unemployed; hence, he "employed 25,000 of them into the Ekiti Volunteer Corp.
The Governor must be commended for showing the need to inquire about employment figures in his state but i fear his solution is short term and a mirage because no government Federal State or Local govt can create jobs.
you hear it all the time, GEJ says he will create jobs, Fashola says he created jobs, but the reality is that if those jobs are not created in the private sector then really no job has been created, the government (state of federal) has simply taken tax revenues which could have built roads or hospitals, and converted them to recurrent expenditures.
A job is created when a demand exists and an entrepreneur hires a person to fill that vacancy. The government by collecting tax revenue has reduced the amount of jobs that entrepreneur can create.
In the short term, Ekiti and others can employ to reduce poverty, but a longer-term plan is to reward companies that employ by giving them tax breaks or concessions. The State can simply grade companies according to how much PAYE the company remits and then do a 50% tax break back to them.
Dangote just signed an agreement with BOI to advance billion to them to loan out at zero interest rates to small scale manufactures, a better approach is to tell Dangote he will get a 50% import duty waiver on every bag of rice he imports for every staff he remits PAYE for based on the minimum wage, same for Shell and Co, reduce the fees the pay to the NNPC, and Department of Petroleum Resources based on how many Nigerian they submit PAYE based on minimum wage.
To submit PAYE they must employ remember.
Ekiti certainly does not have many private sector companies so their challenge is to use their FAAC Oil allocation to build infrastructure and attract Dangote out of high tax states like Lagos to Ekiti. Using the oil money to pay salaries only starts a vicious cycle of high taxes to pay salaries, which drive off private sector investors.
It is our problem we have to fix it
