Abstract This work examine the impact of microfinancing on employment generation in Osogbo Osun State, Nigeria. Questionnaire Research design was adopted in carrying out the research work. Data for the study was collected from 30 selected Microfinance bankers. Simple random sampling techniques was used in selecting the sample for the research work, Spearman ranking correlation and Regression Analysis were used as the technique for analysis using data generated from questionnaire. It was found that microfinancing is one of the best tool that generates employment and reduce poverty in the country. Microfinance institution are veritable tools for empowering low income earners and especially the inhabitants of the rural . The study found that there’s effective frame work for Microfinancing and generation of employment and reduction of poverty in Osogbo Osun State Nigeria. There’s are many measure to curb the menace of Unemployment by Microfinance banks. There exist a significant relationship between Microfinancing and Employment generation in Nigeria. The study found out that there’s a significant relationship between Microfinancing and the inhabitants of the rural area and also found out that microfinancing has a pivotal role in solving the issue of Unemployment. The study therefore recommend that the government should provide enough credit facilities to Microfinance banks in order to deliver on mandate, and Microfinance banks should focus their attention on the inhabitants of the rural area where most of the unemployed and poor people lives, the study also recommend that there should be enhance skill training, management skills and basic education should be provided for borrowers in order to use their Loan effectively for better outcomes. vii TABLE OF CONTENTS. Title page. I Attestation page. ii Certification. iii Dedication. iv Acknowledgement. v Abstract. vi Table of contents. vii CHAPTER ONE: INTRODUCTION 1.1 Background to the study. 1 1.2 Statement of the problem. 4 1.3 Research objectives. 5 1.4 Research questions. 6 1.5 Research hypothesis. 6 1.6 Justification of the study. 7 1.7 Scope of the study. 8 1.8 Definition of term. 9 CHAPTER TWO: LITERATURE REVIEW 2.0. Introduction 10 2.1. Conceptual framework. 11 2.1.1 Employment generation. 11 2.1.1.1 Effects of Unemployment. 13 2.1.1.2. Types of Unemployment 15 2.1.1.3 causes of Unemployment. 21 2.1.2 Microfinancing. 22 2.1.2.1 The rise of Microfinance. 22 2.1.2.2 Microfinancing in Nigeria. 27 2.1.2.3. Various model of Microfinance banking 28 2. 2.3 Theoretical framework. 31 2.2.1. Theory of Phillips curve. 31 2.2 2 Classical economics theory. 32 2.2.3. Theory of effective demand. 34 2.2.4. Trade off theory. 35 2.2.5 Minimalist approach. 37 2.2.6. Credit plus approach. 37 2.3. Empirical review. 38 2.4. Research gap. 42  CHAPTER THREE: METHODOLOGY. 3.1 Introduction. 43 3.2. Research design. 43 3.3 Population. 43 3.4. Sampling size and techniques. 43 3.5 Sources of collection of data. 44 3.6. Research instrument. 44 3.7 Validity and reliability of Research instrument. 44 3.8. Data analysis techniques 45 CHAPTER FOUR: DATA PRESENTATION ANALYSIS AND DISCUSSION OF FINDINGS 4.0 Preamble. 46 4.1. Response return rate. 46 4.2 Demographic information of respondents. 46 4.3 Demographic data of respondents. 46 4.4 Descriptive analysis of the questionnaire items. 49 4.5 Test of hypotheses 51 4.5 Discussion of findings. 57 CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION 5.1. Preamble. 58 5.2 summary of findings. 58 5.3. Conclusion. 60 5.4 Recommendations. 60 5.5. References. 61 CHAPTER ONE INTRODUCTION 1.1 Background to the Study Employment generation is a natural process of social development. Human being brings with them into the world collection of needs that represents employment opportunities for others to meet. Economically, employment provides income to poor families, revives domestic demand for goods and services, and stimulates overall growth. Socially, employment can also promote social healing, encourage the return of displaced persons, and improve social welfare in the long run. But despite the fact that there are lots of needs to be met and the availability of jobs to do, unemployment is still the greatest challenges facing most of the developing countries. Therefore, generation of employment need to be the utmost priority of the government so as to enable people meet their needs as well as improve their standard of living. Unemployment is one of the biggest difficulties facing most of the African countries especially Nigeria, it has been of great concern to elites in development economics as unemployment is not easy to be eradicated. Unemployment in Nigeria has posed to be an incorrigible threat with increasing prevalence all over the States of the federation. The fact is that it’s everlasting sovereignty among the Nigeria youths has led to several other socio-economic problems such as abduction, rebellion, armed robbery and burglary. According to the Nigerian methodology ,the unemployment rate in Nigeria in 2022 is estimated to reach 33 percent. Microfinance banks play important role in the economic growth and development of any government because of their objective to alleviate poverty, create wealth and employment generation.MFB allows people to take on reasonable small business loan safely and in a manner that is consistent with ethical lending practice. According to Okafor (2015), microfinance is seen as a Mini-supermarket that render micro financial services to the poor. The financial services include: microcredit, micro- savings, micro-leasing, micro-insurance, money transfers and micro-investment services. The poor does not lack the initiative or knack for tenacity. The poor lacks the wherewithal to actualize their Dream (Okafor, 2016). It is in consonance with the above that the Central Bank of Nigeria (CBN) established the microfinance banks In Nigeria in 2005. The existing community banks transformed to microfinance banks (CBN, 2005). The Regulatory and Supervisory Framework for Microfinance Banks (MFBs) in Nigeria provides for Microfinance banks investments (RSF, 2005). Microfinance organizations attention is focused on all those sections of our economy that needs financial assistance to bring themselves out of poverty, it is also a precedence for them to attend to the main needs of the have not’s and the unemployed, since virtually 70 percent of people living in poverty are based in the rural areas .It is a common knowledge that till today these rural people are often excluded from education, the workplace, owning property and equal participation in politics. They produce one ½ the world’s food, But own only 1 percent of its farmland. Nearly 85 percent of Opportunity’s loan clients are poor and that too are women. While Opportunity willingly give out loans to men, the organizations believes the best opportunity for interrupting cycles of maximum poverty come from microfinance programs that concentrate on female entrepreneurs. When rural people improve their conditions they also improve the lives of their children. By investing in nutrition and education, they helps in forming a more robust future for their children and their society. The role of microfinancing is to, improve the macro and socio economic development of such rural unemployed people and improve the status of rural unemployed people in households and communities. The micro entrepreneurships are empowering the rural unemployed people’s strength and take away the rural-urban inequalities. Microfinancing promoting the tiny scale business enterprises and its major aim is to alleviate poverty by income generating activities among women and poor. Through their service, people were able to engage in economic activities in order to increase their house hold income and employment opportunities . Before the establishment of formal microfinance institution (MFI) , Informal microfinance activities thrive all over the country, this activities includes local money lending, rotating credit and saving practices, credit from friends and family and government owned institution arrangements. LEMO (2016). With the initiative of microfinancing, people are opportuned to grow and develop as loan and fund are easily given to unemployed and low income earners to start a business there creating job opportunities and eradicating poverty since there’s avenue for lending and investing. The major purpose of this research work is to assess the impact of microfinancing as a tool for alleviating the issue if unemployment in Nigeria using some selected microfinance banks in Nigeria as a case study. However, the obstacle therefore is that while the federal government of Nigeria continues to fund programs aimed at eradicating unemployment, the rate of unemployment cease to decrease and this therefore gives birth to a desire by the researcher to study and assess the impact of these programs on unemployment with specific reference to microfinancing. 1.2 Statement of the Problem. Developing countries like Nigeria, at various levels are unable to curb the problem of unemployment in the society. Microfinancing which we put our hope on as the solution to this issue are unable to achieve their expected goals such as raising funds for domestic resources usage and alleviating poverty. Most of this banks have closed down due to the lack of ability deliver on their mandate or the incapability of possible beneficiaries to make up for the need to access and repay their lending funds in order to aid the continuity of those microfinance bank The reasons are bound ranging from the inability to cater for the poor who came for loan due to lack of funds and also, lack of viable business ideas from the side of the beneficiaries. A very strong condition of collateral is also a great difficulty on the side of the borrower though it is a must, it shouldn’t be too stringent because it could result to non assessment of their funds. The inhabitants in the rural area which are mainly farmers are the very ones in need of the help of microfinance banks because they are the ones producing the country’s food and they are provides over 60 percent of employment to the society but these are the people who finds it difficult to receive loan.  Funding level in the agricultural sector stands at about 2 percent of the total lending of banks as against 6 percent in a country. Some of the reasons for the low funding include lack of understanding of the Agricultural sector, perceived high risks, complex credit assessment processes/procedure and high transactions cost. The problems in the society which the researcher is trying to look into is the issue of unemployment and why it hasn’t been resolved despite the effort to of microfinancing and the issue of which microfinancing is not focusing more on the rural area than the urban area because the problem of unemployment is widespread and the consequences are always intolerable and devastating.  1.3 Research Objectives The main objective of this research is to analyze the impact of microfinancing on employment generation in Nigeria Whereas, the specific Objectives are: i. To examine microfinancing as a tool in combating unemployment in Nigeria. ii. To determine the relationship that exists between unemployment and the inhabitants of the rural area and the poor. iii. To explore the extent to which Microfinancing us able to play a role in solving the problem of Unemployment. 1.3 Research Questions The following questions are to be answered in achieving the research objectives of this research work. i. Is there any relationship between microfinancing and the eradication of unemployment in Nigeria. ii. Does a significant relationship exists between unemployment and the inhabitants of the rural area and the poor. iii. Does microfinancing has a role in the event of solving the problem of Unemployment. 1.5. Research Hypothesis H?1: There is no significant relationship between microfinancing and eradication of unemployment in Nigeria. H?2: There is no relationship between unemployment and the inhabitants of the rural area and the poor. H?3: microfinancing has no role in the event of solving the problem of Unemployment. 1.4 Justification of the Study This study will go a long way in considering the effectiveness and efficiency of microfinancing on the number one problem in Nigeria which is unemployment. It is to evaluate how microfinance banks helps in curbing unemployment and how the employment generation is improved. This research work will go deeper into how Nigeria as a whole will be cured of the plague of Unemployment and it will be of a great help to students because this research work will reveal all the problems in relationship between microfinancing and the level of Unemployment in Nigeria. Theoretically, the study provides a theoretical framework for the understanding of the impact of microfinance banks on the employment generation in Nigeria, therefore considering the pivotal role of microfinancing and the problems microfinance banks faces in the course of rendering their services. This research work will also be of great help to microfinance banks because they play a great role in reducing unemployment rate in Nigeria, so this gives them a reliable reason to ask for loan from the federal government when they have need for that . On the practical significance, this study will be an enlightenment to youths, undergraduates, graduates and the unemployed as a whole who may not have the adequate knowledge of how to help themselves out, to know about microfinancing and how it can help them sign out of the organization of Unemployment. Therefore the results from this research work will benefit upcoming researchers who may want to carry out a research on a topic related to this research work. 1.4 Scope of the Study This research work, Microfinancing and employment generation in Nigeria is a very wide topic but for the purpose of manageability ,time and financial constraints, it has therefore been restricted and limited to the microfinance banks in the sub-western part of Nigeria precisely in Oshogbo Osun state. The microfinance bank which is studied is the LAPO microfinance bank, Oshogbo. In choosing this bank, the researcher has limited her research to those areas of the bank that enhances the generation of employment in Nigeria and used inferences drawn upon to approach other microfinance institution. This was so because the researcher believes that all microfinance institution are saddled with the responsibility of generating employment in Nigeria. The research intends to focus on staffs in LAPO microfinance bank Oshogbo for easy collection and analysis of data. This will reduce cost and avoid complexity that may arise as a result of overpopulation. This project will look at how they generate employment and the approach used, how they helps in curbing the issue of Unemployment therefore improving the standard of living of people and reducing the level of crime unemployment has given birth to and also to look at the problems faced by this Microfinance banks. 1.5 Definition of Terms These are the operational definition of terms used in this chapter, it is to enable readers understand the various terminologies used in the research work. MFI: Microfinance institution. LAPO: Lift above poverty organization MFBs: Microfinance banks CBN: Central Bank of Nigeria MICROFINANCING: This is the provision of financial services to low income clients, including consumer and the self employed who traditionally lack access to banking and related service. EMPLOYMENT: This is the state of being employed and the work is done to earn money EMPLOYMENT GENERATION: This is the process of providing and creating opportunities of jobs to the unemployed. UNEMPLOYMENT: This is the state of being jobless and not having work to do. METHODOLOGY: A set of methods and principle used to perform a particular research. MICRO CREDIT: This is the same thing as Microfinance. MICRO SAVINGS: Is a form of Microfinance where organization and financial institution encourage individuals to save money. MICRO LEASING: This provides loan application, approval and disbursement process. Their service include leasing and point of sale financing for small home and office equipment. MICRO INSURANCE: Thus is the protection of low income people against specific perils in exchange for regular premium payment proportionate to the likelihood and cost of the risks involved. MICRO INVESTMENT: This means investing money in small amount to purchase stock, exchange traded funds (ETFs), or other securities through an app or online investment transfer. OPPORTUNITY LOAN: This are like cash advances in that you only need a current income and a checking account to be approved for a loan. ENTREPRENEUR: This is an individual who creates a new business bearing most of the risks and enjoying most of the rewards. BENEFICIARIES: A person who derives advantage from something. COLLATERAL: This is an asset that a lender accepts as security for a loan. CREDIT ASSESSMENT: It is also known as credit check, it is used to access the solvency of companies and individual. AGRICULTURAL SECTOR: The agricultural sector comprises establishment primarily engaged in growing crops, raising animals and harvesting fish and other animals. EFFECTIVENESS: The degree to which something produce a desired or decisive effect EFFICIENCY: The extent to which time is well used for the intended task. OVERPOPULATION: A situation which occurs when the number of occupants of an area exceeds the ability of that area to provide for those occupants. SIGNIFICANCE: The extent to which something matters. HYPOTHESES: This is an intelligent guess of the unknown. Used loosely, a tentative conjecture explaining an observation, phenomenon or scientific problem that can be tested by further observation, investigation and/or experimentation.