Economic Update

Published 23 Sep 2013

Private universities in Nigeria have shown promising growth and could help retain the thousands of students who have in recent years spent billions of dollars studying abroad. However, to ensure that growth in post-secondary enrolment continues, the increase in the number of private institutions is being matched by increased government investment – part of a broader shift to expand the skilled labour pool.

Although prohibited until 1999, private universities today make up nearly 40% of Nigeria’s post-secondary institutions, with 51 tertiary establishments scattered across the country, according to the National Universities Commission (NUC). In recent years, growth in the number of private universities has been particularly strong, with nine new private institutions opening between 2011 and 2013. The country will welcome its newest campus, the Institute of Technology and Management in Cross River State, in partnership with Highbury College in the UK, in October 2013.

Lack of capacity is an issue across the entire post-secondary landscape. In Ogun State, for example, 28,000 students applied for just 3500 spaces in the Federal University of Agriculture in September of this year. The University of Lagos saw 40,000 applications for the 2011/12 school year but had just 6000 spaces available.

As a result of limited opportunities within the country, thousands receive a post-secondary education abroad. Nigerians spend an estimated N160bn ($1.01bn) on tuition fees at Ghanaian universities, according to NGO Exam Ethics Marshals International, money that could go a long way towards expanding the domestic post-secondary sector. Overall, N1.5trn ($9.45bn) is lost to foreign universities each year, with an estimated 200,000 studying in Ghana and more than 10,000 in Benin. In 2012, British MP Iain Stewart, speaking at a seminar in London, said he anticipated there would be 30,000 Nigerian students studying in the UK by 2015.

One of the chief challenges universities face, both private and public, is ensuring that graduates have the skills employers are looking for. The difficulty of matching curricula with the needs of the job market is one that many emerging markets face, but in Nigeria, it has opened the door for a rise in recent years of specialist institutes and training centres focusing on targeted skill sets, such as technical development. Post-secondary training in management, for example, is set to be an important area of growth, according to industry participants.

“There is a clear shortage of skilled managers in Nigeria, prompting businesses to invest in training. This is true across Africa, with a need for an estimated 10m additional managers, based on the size of the working population,” Enase Okonedo, the dean of Lagos Business School (LBS), told OBG. LBS runs three postgraduate MBA programmes, a small PhD programme and several executive education programmes.

The country is making steady progress towards increasing capacity – in addition to new private institutions, public universities have seen renewed government investment in recent years. In 2011 the Ministry of Education announced the creation of nine new public universities slated to open in 2012, with each receiving $9.79m in funding. Education spending increased to $2.7bn this year, representing 8.7% of the budget, up from $2.56bn in 2012. New universities have made an impact on enrolment numbers; according to the NUC, admission quotas for the 2013/14 school year jumped to 438,777, from 286,850 in the 2011/12 academic year.

The government is working to address ongoing problems in the public education system. The Academic Staff Union of Universities (ASUU) has been on strike since July, arguing that the country’s 78 public universities are dilapidated and that the federal government has been slow to implement an agreement reached with the union in 2009. Some of the ASUU’s demands include increased budgetary allocation for the education sector and improved infrastructure at universities.

The administration moved towards a compromise with the ASUU in early September when Gabrial Suswam, governor of Benue state, announced that the government would be investing N1bn ($6.3m) in unspecified programmes aimed at improving infrastructure, with total investment expected to reach N100bn ($630m) in the years ahead.

Although infrastructure deficiencies and limited capacity pose significant problems to post-secondary growth, the government and private sector have both taken steps to alleviate the shortage of facilities. Further development of this relatively untapped sector could go a long way to improving education and overall economic development in Nigeria.