"Japanomics" - The Exodus of the Nigerian Middle Class
Since the return to democratic governance in 1999, Nigeria has undergone significant economic reforms and policy changes. The middle class has played an active role in that process, advocating for good governance, accountability, and economic development. The rise of the telecommunications sector and the expansion of the banking & financial services, along with more recently the technology industry, created new opportunities for the middle class, including employment, entrepreneurship, and investment. However, the worsening economic situation in Nigeria has seen spending power curtailed and disposable income eroded, leading to a reduction in the size of the middle class. This has been exacerbated by an exodus largely to Canada, United States, United Kingdom and Australia in a term colloquially known as "japa". Japa (pronounced "jak-pa") is a Yoruba word that means to run away from danger and has popularly encapsulated the general sentiments of the youth in Nigeria. In this article, we examine the role that the Nigerian middle class has to play in driving economic development and explore some of the consequences of the "japa" movement.
The Nigerian Socioeconomic Classes
The criteria to be considered middle class in Nigeria can vary based on different sources and perspectives. Generally, the middle class is defined based on a combination of income, consumption patterns, and socioeconomic status. However, it is important to note that there is no universally accepted definition, and the criteria can differ depending on the context and the purpose of the analysis. For the purpose of this article, let us describe the generic socioeconomic classes in the Nigerian society:
Upper class (Elites): Very wealthy and powerful upper class that owns and controls the means of production. They have superior financial might, combined with their amassed - usually generational wealth - gives them the ability to wield political powers. Typically, the top 1% of the society.
Middle class: Professional workers, SME business owners and business managers. The middle class has always been the most contested of the three categories due to the broad group of people in contemporary society who fall socio-economically between the lower and upper classes. It could be further stratified into upper middle class, lower middle class, and working class. However, for the purpose of this article, we will group this class together. They can be described as the engine room of the Nigerian economy. However, this group are often one job loss or major illness away from falling into financial difficulties and poverty.
Lower (under) class: They typically rely on low-paying wage jobs for their livelihood and often experience poverty. This group are largely unskilled workers or unemployed. They make a living hawking or doing menial jobs, hence they live off less than $2 a day which is the world’s benchmark for extreme poverty; In Nigeria’s economic terms, these people earn less than the minimum wage standard of NGN 30,000($38)/ $460 per annum in today's exchange rate. About 48% of the Nigerian population fall in this category and based on current currency devaluation, this is set to increase.
The Socio-economic Importance of the Middle Class
The strength, vibrancy and viability of any prosperous economy is determined by the size of its middle class. The middle class is the glue that holds society together. Its presence and stability are considered vital for the overall functioning and prosperity of any capitalist economic system as they provide the buffer between the extremely wealthy and the extremely poor. This socioeconomic class drives economic growth & consumer demand, entrepreneurship and Innovation, social stability & cohesion, human capital development, political engagement and democracy and balancing economic inequalities.
The middle class is a major driver of consumption in Nigeria. Middle-class households spend more on a variety of goods and services, including food, housing, transportation, education, and healthcare. This increased consumption has helped to boost economic growth in Nigeria. The middle class is also a major source of investment in Nigeria. Middle-class households save more money than poorer households, and they are more likely to invest their savings in businesses and other assets. This investment helps to create jobs and grow the economy. The growth of the middle class has had a positive impact on economic growth in Nigeria and if it continues to grow, it is likely to have an even greater impact on Nigeria's economy.
The Japa trend
Although japa is trending, especially among Nigerian Gen Zs, the actual numbers that are emigrating are not as significant as previous times in Nigerian historical context. For example, in 1983 there was a net negative migration of 1.73 per 1000 population, which represented an annual change of 91% from the previous year. Between 2015 to 2023, the net negative migration figures have roughly been around 0.30 per 1000 population with annual percentage changes not exceeding 2%. So yes, people are emigrating but no way near as alarming as in the 1980s.
Several factors have contributed to the recent emigration statistics of Nigeria's middle class such as: socioeconomic factors, political instability, education & professional opportunities. Limited employment opportunities, low wages, inadequate infrastructure, and a challenging business environment discourage the middle class from staying in Nigeria. The search for higher-paying jobs and better living standards abroad becomes a compelling incentive for emigration.
The pursuit of quality education and better professional opportunities is another driving force behind middle-class emigration. Many Nigerian professionals seek advanced education or job prospects in countries with well-established institutions and industries. Data from the Nigerian Association of Resident Doctors recently revealed a departure rate of 100 Nigerian doctors monthly leaving approximately 10,000 resident doctors left in the nation.
Imagine a diligent doctor that started employment in 2010 and was earning N3m annually ($19,800 approx.), gets a series of promotions and pay rises and in 2023 now earns N15m annually ($19,200 approx.). So, a 400% increase in Naira terms over 13 years, but in actuality, 3% decrease in Dollar (USD $) terms. This is without even factoring inflation!
Whilst these factors also affect other socioeconomic classes, the middle class are the best suited to move out in droves due to a number of significant reasons:
- Eligibility for Study & Skilled work visa schemes
- Affordability requirements (visas, flight tickets, tuition fees etc.)
- Few structural ties (assets, businesses, political ties)
- Aspirations & values (career focused, tax paying, law abiding)
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| href='https://www.macrotrends.net/countries/NGA/nigeria/net-migration'>Source</a> |
Those at the lower rung of the socioeconomic ladder are also "japa-ing" but their version is not as attractive and certainly more deadly - involving traversing through the Sahara desert, avoiding murder, kidnapping and enslavement, and surviving the Mediterranean Sea on an inflatable only to land in Europe and end up living their lives on the fringes of society under the constant fear of arrest and deportation... Or worse! Ironically, immigration figures tend to be refugees and low-skilled workers from neighbouring West African countries, entering Nigeria for safety and in the search for better economic opportunities given the relative size of the Nigerian economy to other countries in West Africa.
The Effects of Japa
Brain Drain: The emigration of highly skilled professionals results in a brain drain, depleting Nigeria of its intellectual capital. This hampers the development of critical sectors, including healthcare, education, engineering, technology, and leads to a shortage of skilled labour, which impedes overall economic growth and innovation. Furthermore, the poorly-funded education system makes it tougher to churn out competent, well-rounded professionals that are able to critically provide Nigerian solutions to Nigerian problems. The financial services and technology industries in Nigeria can certainly attest to this. Several vacancies remain unfilled due to skills shortages. In fact, companies are now more amenable to remote working from key personnel that have "japa"ed.
Reduced Investment and Entrepreneurship: Emigrating middle-class entrepreneurs take their investments, knowledge, and business acumen with them, resulting in reduced domestic investment and entrepreneurial activities. This impacts job creation, innovation, and economic resilience. The upper (ruling) and lower classes are affected by this in different ways: the former will lose Nigerian talent (that understand the business terrain) to manage their local investments and create job opportunities, whilst the latter end up mired in crippling poverty due to the lack of jobs and economic opportunities.
Remittances: On the positive side, emigrant middle-class individuals may send remittances back to Nigeria, contributing to foreign exchange reserves and providing financial support to their families. However, this inflow is often insufficient to offset the overall economic loss caused by emigration.
Life Experience: A less obvious aspect that is often ignored by the japa movement is the fact that those that go and experience what living in foreign countries is like, may develop a new perspective on life. Their romantic ideas of living abroad, thinking their lives would be instantly better, soon becomes a dose of reality. All of a sudden, living in Nigeria does not seem as bad after all. They tend to come back to Nigeria with a new lease of life on how to develop the country in their own little way.
No Place Like Home
The middle class in Nigeria holds tremendous potential to drive economic growth, foster innovation, and create a more inclusive society. The dwindling middle class and poor socioeconomic conditions in Nigeria are positively correlated. Given the option, a large number of Nigerians in the diaspora would prefer to live in Nigeria if things were better. Nigeria is undoubtedly one of the most blessed nations on earth when it comes to climate, natural resources, landscape, cultural diversity and of course, entertainment. The annual influx of "I just got back" aka IJGB is a testament to the yearning for home but alas, the conditions at home are simply not conducive to eke out a decent living.
Although, given the tougher economic realities in Europe and other developed countries, lack of jobs and increasing inflation has made some that have japa to reassess their realities. The once proudly middle class, high flying corporate executive in Nigeria now finds themselves stacking shelves in a local supermarket, cleaning public toilets or labouring in a construction site in Europe, Canada, USA or Australia, just to earn a living. Work that they would never have dreamt of having to do in Nigeria due to their socioeconomic status.
The cost of emigrating increases every year as the Nigerian currency further devalues, especially for those that choose the study route. Universities in the United States and Australia have the highest annual tuition rates, ranging from $32,000 to $60,000, while Ireland is close behind with annual tuition rates as high as $45,000. For undergraduate and graduate courses, tuition fees for international students in the UK range from $14,100 to $38,000. Given an enabling environment, these funds could go a long way to boosting the economy if harnessed into productive ventures in Nigeria. Why are Europe, Canada, Australia and USA poaching our doctors and nurses, tech bros (and sis), engineers etc? Why can we not create the conducive environment at home so that these people do not have to japa?
Thanks for taking time out to read this article. Please feel free to send me a message or comment on the article. I am always happy to discuss other perspectives and explore different philosophies.
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