BARRIERS TO EMPLOYMENT GENERATION BY RURAL SMALL BUSINESSES IN BENUE STATE, NIGERIA
Keywords:
Rural Small Businesses, Employment Generation, Entrepreneurship Ecosystem JEL Classification: L26, O12, M13, O18.Abstract
This study identified and critically analyzed the barriers inhibiting employment generation by
rural small businesses in Benue State, Nigeria. The research investigated the structural,
infrastructural, sociocultural, and institutional challenges confronting rural entrepreneurship
and developing insights to inform more effective policy interventions. Focusing on the three
senatorial districts of Benue State, the study employs a quantitative survey approach utilizing
two-stage cluster sampling, with 360 small businesses randomly selected across twelve local
government areas. Employing the Entrepreneurship Ecosystem Theory as the theoretical
framework, the research methodically collected and analyzed data through questionnaires. The
findings reveal a complex entrepreneurial landscape characterized by a progressive gender
composition, with women comprising 55% of small business ownership, and a predominantly
micro-enterprise structure primarily employing 1-10 workers. Similarly, the study uncovered
significant barriers to employment generation, including financial constraints affecting 28.4%
of enterprises, high production costs impacting 18.4% of businesses, and inadequate
infrastructure challenging 14.7% of entrepreneurial efforts. Furthermore, the research
highlights the diverse sectoral landscape, with agriculture, financial services, and retail trade
emerging as leading sectors. Additionally, the study identifies critical support needs, with
access to finance (31.8%), infrastructure improvement (19.1%), and training/mentorship
(18.1%) emerging as key priorities. Consequently, the research recommends a comprehensive
policy approach involving specialized microfinance programs, infrastructure investment,
entrepreneurship training initiatives, simplified business regulations, market access platforms,
and gender-inclusive entrepreneurship strategies to enhance employment generation and drive
sustainable rural economic development.
