Sources of Income for Households in Nigeria Income Sources for Nigerian Households In 2010, the Nigeria National Bureau of Statistics 90% implemented the General Household Survey 80% (GHS), which included a panel component 70% focusing on livelihoods, agriculture, and Ag/livestock 60% household welfare. The GHS-Panel survey was 50% Wage conducted on a sample of 5,000 households and 40% is nationally representative. The first wave of the 30% HH enterprise survey was implemented in two visits to 20% households: visit 1 ran from August to October Other 10% 2010 and visit 2 ran from February to April 2011. 0% The second wave will run from 2012/2013. Rural Urban Using data from the first wave, this note presents a basic profile of income sources for households While about 80 percent of urban families earn in Nigeria. It explores different income sources income from a non-farm business activity, urban and the correlates of income sources with households are also diversified. Of the household traits. Income is classified into four households with an enterprise, 43 percent also main categories: agricultural (growing crops or have some wage income. And, perhaps raising livestock), non-agricultural enterprise (a surprisingly, agriculture is not only for rural small shop or other form of household self- dwellers: one in four urban households engages employment), wage or salary income (having an in some form of agriculture. employer), and other, non-labor income. Urban households are more likely to have other Diversification of Income Sources income (such as transfers from family and friends, A first look at income sources for households and rental income) than their counterparts in shows a number of salient features. First, rural areas. This category also includes diversification is the norm. Of the four main remittances from family abroad. Such income is categories of income sources, on average, very rare among Nigerian households; fewer than Nigeria households have just under two sources 2 percent of all households receive this type of of income, with over 80 percent of all households income. reporting two income sources. Very few households report income from all four sources. Household Traits and Income Sources Among rural households, four out of five On average, female-headed households are less households are engaged in some agricultural diversified. Over half of these households have activity – either farming crops or maintaining only one category of income source, compared livestock. However, these households also tend to 35 percent of male-headed households, as is to be involved in other activities: about 60 visible in the figure below. percent of these agricultural households also have a non-farm enterprise, and twenty percent Households with more prime-age adults are of farm households have at least one member more able to diversify and are observed to have that reports some wage employment. slightly more income sources. Nigeria National Bureau of Statistics Brief www.nigerianstat.gov.ng Wage Income Income from wages and salaries is often associated with higher living standards. Wage work is more prevalent in urban areas, where nearly half of households report any such income, compared to a quarter of rural households. The data show that households with more highly educated heads are more likely to have this type of income. The gap is large: 17 percent of households whose head has no schooling, compared to 76 percent of those with post-secondary. Male-headed households are also more likely to Farming: Cash or Consumption? have wage income compared to those headed by While about 60 percent of all households in females (36% to 21% respectively). Interestingly, Nigeria are growing crops or rearing livestock, the age of the head is not associated with a not all of this activity earns Naira for the different likelihood of having any income from household. About one third of these households wage or salary work. By zone, households in the are engaged in farming for consumption – they South East are the least likely to have such earn no cash from sales of crops or livestock. income (26%), while those in the South South are the most likely (42%). Across the six zones, there is variation in the share of households that sell any agricultural While wage income is not an uncommon income output and those that only consume their source for households, for individuals it is not product. The North Central and North East have common. That is, households with such income the large share of farming households that sell have at most one person with wage income. both crops and livestock output, whereas Thus, the share of the labor force (i.e. those households in the South South and South West working or looking for work) with wage are among the least likely to do both. The South employment is about half of the portion of South zone has the largest fraction of farm households with this type of income. households (60 percent) that only engage in agricultural activity for home consumption. Across gender, we observe stark differences. Men are almost twice as likely to have any wage or salary work: 14 percent in comparison to 8 100% percent. This gender gap in wage work holds both within rural and within urban areas. The gender gap also exists in all zones. 80% Only home This brief is based on data collected by the 60% consumption Nigeria National Bureau of Statistics as part of the Living Standards Measurement Study – Only livestock Integrated Surveys on Agriculture (LSMS-ISA) sales project. The full dataset is available for download 40% Only crop sales at www.worldbank.org/lsms-isa. 20% Both For more information, please visit: www.nigerianstat.gov.ng 0% Or contact: National Bureau of Statistics feedback@nigerianstat.gov.ng Nigeria National Bureau of Statistics Brief www.nigerianstat.gov.ng