From Street Vendor to Tech Entrepreneur: The Evolving Face of Nigeria’s Informal Sector

Ololade Adeniji

Adebayo Akinola, 28, sits in a bustling co-working space in Lagos, his fingers flying over his laptop keyboard. He’s not working on a corporate project or filing reports for a multinational. Instead, he’s running his own digital marketing agency, serving clients from across Nigeria and beyond. Just three years ago, Adebayo was working a 9-to-5 job at a bank, feeling unfulfilled and underpaid.

 Today, he’s part of a growing cohort of young, educated Nigerians who are redefining the country’s informal sector.

“I never thought I’d end up in the informal sector,” Adebayo admits with a smile. “In school, we were always told to aim for formal, corporate jobs. But here I am, running my own business, making more money, and feeling more satisfied than ever.”

Adebayo’s story is far from unique. According to a groundbreaking report by Jobberman, Nigeria’s leading recruitment platform, the face of the country’s informal sector is changing rapidly. Gone are the days when the informal economy was synonymous with uneducated street vendors and subsistence farmers. Today, it’s a dynamic ecosystem of businesses ranging from tech startups to creative industries, from artisanal crafts to digital services.

The report’s findings challenge many long-held assumptions about the informal sector. Perhaps most surprisingly, 96% of informal workers and 80% of business owners in this sector have higher education degrees. These are not people who couldn’t find “real” jobs; these are entrepreneurs and skilled professionals who have chosen the informal sector for its opportunities and flexibility.

There has been a significant shift in how young Nigerians view work and career success. The traditional path of climbing the corporate ladder is no longer the only or even the most attractive option for many graduates. This is corroborated by the  Jobberman Informal Sector report which reveals that 18% of surveyed business owners left formal jobs to start their own ventures in the informal sector. Of these, a staggering 80% cited low salaries as the primary reason for their transition.

But it’s not just about the money. For many, like Adebayo, the informal sector offers something that traditional jobs often lack: flexibility and the potential for innovation.

“In my old job, I felt like a cog in a machine,” Adebayo says. “Now, I can be creative, take risks, and see the direct results of my work. It’s challenging, but it’s also incredibly rewarding.”

The rise of digital technology has played a crucial role in this transformation. The internet and mobile technology have opened up new markets and opportunities for informal businesses. A fashion designer in Ibadan can now sell to customers in London. A software developer in Enugu can work for clients in Silicon Valley.

Take the case of Amina Yusuf, a 32-year-old freelance content creator based in Kano. With a degree in Mass Communication, Amina started her career at a local radio station. Today, she creates content for brands and individuals across Nigeria and has even landed international clients.

“The internet has been a game-changer,” Amina says. “I can work from anywhere, reach clients I never could have before, and build a personal brand that goes beyond traditional employment.”

However, the informal sector is not without its challenges. Many workers in this sector lack social protection, face financial insecurity, and struggle to access credit and other business support services. The Jobberman report found that 39.61% of surveyed workers say they have just enough to cover living expenses without allowance for savings or investments.

“We need to recognise the value of the informal sector and provide the right support systems,” argues Glory Aiyegbeni, Lead Researcher at Jobberman Nigeria. “This sector is driving innovation and creating jobs. With the right policies, it could be an even more powerful engine of economic growth.”

Some of the key areas where support is needed, according to the report, include:

1. Skills Development: While many in the informal sector are educated, there’s a need for continuous learning to keep up with rapidly evolving industries.

2. Access to Finance: Many informal businesses struggle to access credit from traditional financial institutions.

3. Social Protection: There’s a need for innovative solutions to extend social security and health insurance to informal sector workers.

4. Digital Infrastructure: Reliable and affordable internet access is crucial for the growth of digital informal businesses.

Despite these challenges, the future looks bright for Nigeria’s evolving informal sector. The sector is expected to continue growing, with a projected 25% increase in the number of informal enterprises in urban areas over the next few years.

For young Nigerians like Adebayo and Amina, the informal sector represents not just a job, but a chance to shape their own destinies and contribute to Nigeria’s economic future.

“I’m excited about what’s to come,” Adebayo says, his eyes shining with enthusiasm. “We’re building something new here, something that could change the way we think about work and economic development in Nigeria.”

As the sun sets over Lagos, casting a golden glow over the city’s skyline, Adebayo turns back to his laptop. In co-working spaces, home offices, and even on smartphones across the country, millions of other informal workers are doing the same. They are the new face of Nigeria’s informal sector – educated, tech-savvy, and entrepreneurial. And they just might hold the key to the country’s economic future.

* Mrs Adeniji writes from Lagos