Small and Medium Scale Enterprises and Employment Generation in Edo State, Nigeria
Small and medium scale Enterprises (SMEs) are recognized as the major drivers of employment generation in many economies today. This does not seem to be the case in Edo State, Nigeria where, apparently, many of these small-scale businesses are one-man businesses. There is a dearth of literature regarding the structure of these SMEs and the reasons they fail to be major sources of employment generation in Edo State The aim of this study was thus to bridge this gap and to provide a sectoral analysis of the efficacy of SMEs as a vibrant tool for employment generation in Edo State Nigeria. The research instrument was made up of a questionnaire and a personal interview. The questionnaire was administered on 210 SMEs in Benin City and selected towns (Ekpoma, Uromi, Auchi, and Igarra) in Edo State. Data analysis was done using the Statistical Package for Social Sciences (SPSS), which generated the frequency distributions means, standard deviations, and variance. Out of the 210 SMEs surveyed, 75 were one-person owned and operated, 68 employed 2-5 per persons, 43 employed 6-10 and 24 had at least 11 employees. Among the businesses surveyed, 117 were owned by men and 93 were owned by women. The men-owned business was engaged in Services, Manufacturing and Processing, e.g. Animal Feed Production, Oil Mill operation Car Mechanics, Plumbing, etc. The women-owned businesses were mostly involved in services and processing e.g. Beauty Salon, Fashion Designing, Retail Businesses, Restaurant Operations, Food Vending, etc. In the one person owned business, the average daily revenue ranged from ₦600 to ₦6,000. On the average, about 65% of the SMEs owners were graduates from tertiary institutions; however, only very few of them applied modern Business techniques to their Businesses. Moreover, 85% of the Business owners studied disciplines that are different from their present area of occupation. In the absence of a formal organized staff training development structure, the SME owner simply makes effort to bequest some skills to his or her apprentice, with the hope that such skills will help enhance future Business activities. It was also evident from the results that modern business skills like bookkeeping, banking and the use of financial instruments were generally lacking among SME owners. The lack of technical know-how about the operation of small businesses in a modern world and access to finance must be addressed before SMEs can become a major employer of labour in Edo State.