THE IMPACT OF BUSINESS AND ENTREPRENEURIAL EDUCATION ON GROWTH OF SMES

CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND TO THE STUDY

Nigeria is presently faced with, among others, the challenges of dwindling oil revenue, high youth unemployment rate, very high foreign exchange rates and recession. According to the Ministry of Budget and National Planning (2017), the current administration recognizes that the economy is likely to remain on a path of steady and steep decline if nothing is done to change the trajectory. It is in this context that this Government has made several eorts aimed at tackling these challenges and changing the national economic trajectory in a fundamental way..

According to Etuk et al. (2014), SMEs constitute significant sources of employment opportunities and wealth creation. While the citizens benefit in terms of employment and income, government also benefits by generating revenue in form of taxes. hey help in economic development through industrial disposal and production of primary and intermediate products. Entrepreneurship education inculcates in its recipients, entrepreneurial competencies and skills geared towards focusing their minds towards self-reliance and self-employment. On the directive of the Federal Government of Nigeria, most tertiary institutions in recent times have incorporated entrepreneurship education into their curricula as a means to stimulate self-reliance and self-employment in the society. Most economies now support entrepreneurship education, so as to achieve objectives such as encouraging their citizens to demonstrate positive attitude towards self-employment, identify viable business opportunities, portray a desire to venture into business, demonstrate managerial skills for running successful enterprises, and encourage new start-ups and other entrepreneurial ventures (Njoroge and Gathungu, 2013).

The key to the success of establishing a culture of entrepreneurship in Africa is education and training, which depends on all the stakeholders, including state, educators, and learners themselves. Apart from the educational impact and influence, the school can be regarded as the place where the most (holistic) profound impact can be brought about in the development of the youth. One of Africa’s greatest limitations to economic development can be ascribed to its lack of entrepreneurs. The ratio of entrepreneurs to workers in Africa is approximately 1 to 52, while the ratio in most developed countries is approximately 1 to 10 (Acs, & Armington, 2004). National development refers to the ability of a nation to improve the lives of its citizens in terms of human capital, economy, social improvement, democracy building, among others. According to Lawal (2014) it is an exploitation and utilization of both human and material resources to improve the lots of a nation as it embraces the improvement in the social welfare of the people of that nation.

Education serves as a cornerstone to any form of development as it lies at the heart of every society. It is a key and a vital element in the broad development of the nation’s youth’s capacity to address and solve surrounding problems or diiculties. According to Ezeani (2012) education consolidates and holds upon basic education to empower the youth to really live, function as a productive member of the society, earning a living, and contributing to societal progress. Business education continuously builds on the knowledge, skills, values and attitude learnt at the lower phases of education. Education itself does not only mean schooling even though schooling is essential, yet it is a much wider concept embracing formal and informal methods of learning; traditional and non-traditional teaching processing, self-learning (through various media such as books, Tv, internet, Radio , etc). Business education which encompasses several disciplines enables people to think, speak and behave in ways that support the growth, efficiency and effectiveness of an organization or several organizations. Kaegon (2009) once stated that business education must be ready to oer their recipients functional education that will enhance performance as well as assist them to contribute meaningfully to the economic development of the country, but one who has highly developed business skills honed through years of experience in his field without basic education in business does well in contributing to national goal of poverty alleviation through employment creation. Although they might have some gaps in their understanding, so taking a few classes to shore up their skills in a particular area becomes imperative. Thus, the demand for business education is on the increase all over the world as it prepares youths to be responsible and entering individuals, who become entrepreneurs or entrepreneurial thinkers by exposing them in real life experience where they will be required to think, take risks, manage circumstances and incidentally learn from the outcome (Olawolu and Kaegon, 2012).

Therefore, business education as a discipline is expected to expose its recipients to diversity curricula, hence, it is that type of education that inculcate in its recipients attitudes, knowledge, skills, values that is required in the business world.Nigeria’s economy is predominantly a small and medium enterprise economy although the business and other services sector recorded a real GDP growth of 9.20% in the third quarter of 2013 compared to 11.33% recorded in the second quarter of 2013, and the 9.11% recorded the third quarter of 2012. The decline in growth recorded in the third quarter of 2013 relative to its performance in the second quarter indicates slower economic growth largely related to infrastructural challenges (NBS, 2014). Thus, it is expected that business education which oen digests into business enterprises would help in alleviating poverty and reducing unemployment thereby contributing towards national development. It is instructive therefore to investigate the impact of business education on the growth of SMEs as a basic tool to national development.

1.2 STATEMENT OF THE PROBLEM

Nigeria is currently faced with serious economic challenges. There is therefore an urgent need for resuscitation and diversification of the economy. Small and Medium Enterprises contribute significantly to the economic growth and development of Nigeria. Dogarawa (2011) asserts that SMEs, not only contribute significantly to improve the living standards and serve not only as a catalyst in the process of development, but also bring about substantial local capital formation and achieve high levels of productivity and capability. They are also the main agents for achieving equitable and sustainable industrial diversification and distribution; and in several countries SMEs account for well over half of the total share of employment, sales and value added. Given the great potential of SMEs to bring about social and economic development, this study sought to establish how acquisition of entrepreneurship education skills; adoption and use of technology; and globalization through improved cross-border transactions could enhance performance of SMEs, bring about economic recovery and thus help to ameliorate the current economic challenges of Nigeria. This is because SMEs are known to be the largest employers of youths in Nigeria. SMEs also substantially contribute to the GDP. The multiplier effects can therefore be felt across all sectors of the economy.