Influence of slum-based enterprises on employment generation in Southwestern Nigerian cities

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Authors: Olusegun Timothy Odesola, Oluwafunke Adetan, Adedayo Michael Adebisi, Bridget Uchenna EGWU, Kayode Samuel Adeyemi
Cited by: 1
References: 18

Abstract

Slum-based enterprises (SBEs) are the hidden engine of employment in Africa’s rapidly urbanizing cities, yet their contribution remains poorly understood and often dismissed as mere survivalism. This study examines how SBEs generate jobs in Southwestern Nigeria, moving beyond firm-level analysis to assess the relative importance of enterprise attributes versus systemic factors. Using a cross-sectional survey of 435 SBE owners across six states and Partial Least Squares Structural Equation Modeling (PLS-SEM), we find that SBEs create employment primarily through their scale and structure (β = 0.21, p < 0.001), their resilience to challenges (β = 0.20, p = 0.015), and their deep integration into local economies (β = 0.46, p < 0.001). By contrast, product-service offerings and internal management practices show no significant direct effect on employment. Together, these factors explain 52.4% of the variance in job creation. These findings reposition SBEs not as marginal survival units but as embedded adaptive systems whose resilience directly fuels grassroots employment. Consequently, effective policy should shift from formalizing individual enterprises toward reinforcing their ecosystem – through pro-poor infrastructure, flexible microfinance, and digital platforms that reduce transaction costs without bureaucratic burdens.

Fields of Study & Subjects

Urban and Rural Development Challenges Local Economic Development and Planning Construction Engineering and Safety

Publication details

Journal / source
Journal of Small Business & Entrepreneurship
Publisher
Informa UK Limited
Pages
1–26
Publication date
2 June 2026
Language
EN