Regression Analysis of Foreign Direct Investment on Employment Creation in Nigeria

FDI is very important for countries to reduce their rates of unemployment. Therefore, knowledge on foreign direct investment, economic growth, government revenue, increased tax, and living standard and its application will help determine its success on employment creation in every economy. The paper examines the impact of Foreign Direct Investment (FDI) on employment creation in Nigeria. The study was exploratory research, which was conducted using a survey design. Valid sample adequacy of 292 respondents was employed. We conducted a comprehensive investigation to determine the impact of each variable on employment. During the statistical analysis, we employed the multiple linear regression model and ANOVA test to establish the significant impact of the explanatory variables (foreign direct investment, economic growth, government revenue, increased tax, and living standard) on employment. Our test results suggest that hypotheses (H1, H2, H3, and H4) have established the following results: Foreign direct investment is statistically not significant on employment creation. Economic growth is not statistically significant in employment creation. Government revenue generation through foreign direct investment does not impact positively on employment creation and an increase in tax revenue does not impact positively on employment creation respectively. The test result is an indication that foreign direct investment received into the Nigerian economy is not impacting significantly on employment creation. However, H5 statistically established that whenever employment is created it will affect living standards positively. This indicates that a percentage change in employment creation will lead to a positive change or increase in the living standards of the people. A negative reverse of this result will widen the unemployment gap in the country which will consequently affect the living standard of the populace. The research is an important contribution to the existing knowledge on FDI. The application of these research findings will serve as a guide and the need to appropriately channel the foreign direct inflows received into employment creation to ease or close the unemployment gap in Nigeria. This is a means of boosting the economic growth and prosperity of nations