HUMAN CAPITAL DEVELOPMENT AND THE PERFORMANCE OF AGRO-ALLIED SMES IN NORTH CENTRAL, NIGERIA
Keywords:
Human Capital, Entrepreneurial Ecosystem, Skills Development,, SME PerformanceAbstract
This paper is a part of my thesis titled “Entrepreneurial Ecosystem Components and the Performance of Agro-allied SMEs in North Central, Nigeria. It examines the influence of human capital development on the performance of agro-allied small and medium enterprises (SMEs) in North Central Nigeria. Implementing a quantitative research approach, primary data were collected via structured questionnaires given to agro-allied SME operators and employees across six States and the Federal Capital Territory. A descriptive cross-sectional design and simple random sampling were used to survey a population of 1,492 registered agro-allied SMEs, producing 713 valid responses for analysis. Human capital was measured using indicators of employee education, managerial experience, training, workforce competence, and continuous learning, while SME performance was proxied by competitive advantage. Data were analysed using descriptive statistics, regression analysis, and partial least squares structural equation modelling (PLS-SEM). The results disclose a strong human capital base among agro-allied SMEs and demonstrate a positive and statistically significant relationship between human capital and SME performance (β = 0.77, p < .001). The structural model shows that human capital explains 68.2% of the variance in SME performance, indicating substantial clarifying power. Despite widespread investment in training and skills development, evidence of residual skill gaps highlights the need for more targeted, sector-specific capacity-building initiatives. The study concludes that sustained investment in workforce education, entrepreneurial experience, and continuous learning is critical for enhancing productivity, competitiveness, and long-term performance of agro-allied SMEs. These findings provide important policy and practical understandings for strengthening human capital as a primary driver of agro-allied SME performance.
References
Audretsch, D. B., Belitski, M., & Desai, S. (2019). National business regulations and city entrepreneurship in Europe. Small Business Economics, 53(4), 783–800.
Adegbite, E., Amaeshi, K., & Nakajima, C. (2023). Human capital development and performance of small and medium-sized enterprises in emerging economies. Journal of Small Business Management, 61(4), 1452–1475. https://doi.org/10.1080/00472778.2022.2034901
Adegbite, E., Amaeshi, K., & Amao, O. (2019). The politics of shareholder activism in Nigeria. Journal of African Business, 20(2), 214–234. https://doi.org/10.1080/15228916.2019.1584278
Adelaja, A. O., Iyiola, O. O., & Adegbuyi, O. A. (2021). Human capital development and innovation performance of small and medium enterprises in Nigeria. Journal of Small Business and Enterprise Development, 28(7), 1023–1041. https://doi.org/10.1108/JSBED-04-2020-0138
Akanbi, P. A., & Itiola, K. O. (2013). Exploring the relationship between human capital development and entrepreneurial performance: Evidence from Nigerian SMEs. Journal of Management Policy and Practice, 14(2), 72–85.
Afolayan, A. A., Plant, E., White, G. R. T., Jones, P., & Beynon-Davies, P. (2020). Information technology usage, innovation, and human capital development in SMEs: Evidence from Nigeria. Journal of Small Business & Entrepreneurship, 32(3), 239–255. https://doi.org/10.1080/08276331.2019.1651137
Aremu, M. A., & Adeyemi, S. L. (2011). Small and medium scale enterprises as a survival strategy for employment generation in Nigeria. Journal of Sustainable Development, 4(1), 200–206.
Akinwale, Y. O., Adekunle, I. A., & Olomu, M. O. (2021). Human capital, innovation capability and firm performance: Evidence from manufacturing and agro-based SMEs in sub- Saharan Africa. Technological Forecasting and Social Change, 173, 121073. https://doi.org/10.1016/j.techfore.2021.121073
Becker, G. S. (1964). Human capital: A theoretical and empirical analysis, with special reference to education. University of Chicago Press.
Belitski, M., Guenther, C., Kritikos, A. S., & Thurik, R. (2022). Economic effects of the COVID- 19 pandemic on entrepreneurship and small businesses. Small Business Economics, 58(2), 593–609.
Brixiová, Z., Kangoye, T., & Said, M. (2020). Training, skills, and productivity in African manufacturing firms. World Development, 136, 105055.
Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2019). A primer on partial least squares structural equation modeling (PLS-SEM) (2nd ed.). Sage Publications.
Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2022). Multivariate data analysis (9th ed.). Cengage Learning.
Nwankwo, S., & Kanyangale, M. (2022). Entrepreneurial experience, managerial capability and SME performance in developing economies. Small Business Economics, 59(3), 1035– 1054. https://doi.org/10.1007/s11187-021-00547-8
Ogundele, O. J. K., Akingbade, W. A., & Akinlabi, H. B. (2018). Entrepreneurial human capital and firm performance in Nigeria. Journal of African Business, 19(1), 1–19. https://doi.org/10.1080/15228916.2017.1388766
Ogunleye, O. O., Owolabi, S. A., Sanyaolu, O. A., & Lawal, O. O. (2018). Human capital investment and firm performance: Evidence from manufacturing SMEs in Nigeria. International Journal of Economics and Financial Issues, 8(6), 1–9.
Okeowo, T. A., Akinwale, Y. O., & Adepoju, A. A. (2022). Entrepreneurial competencies, human capital, and performance of small firms in Sub-Saharan Africa. Africa Journal of Management, 8(3), 287–307. https://doi.org/10.1080/23322373.2021.2010487
Olugbola, S. A. (2017). Exploring entrepreneurial readiness of youth and startup success components: Entrepreneurship training as a moderator. Journal of Innovation & Knowledge, 2(3), 155–171. https://doi.org/10.1016/j.jik.2016.12.004
Stam, E. (2015). Entrepreneurial ecosystems and regional policy: A sympathetic critique. European Planning Studies, 23(9), 1759–1769.
Urban, B., & Hwindingwi, R. (2024). Skills development, learning orientation and performance of SMEs in emerging markets. International Small Business Journal, 42(2), 214–236. https://doi.org/10.1177/02662426231162154
World Bank. (2022). Enhancing innovation and productivity among SMEs in Sub-Saharan Africa.
Downloads
Published
Issue
Section
License
Copyright (c) 2026 This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International License, which permits unrestricted use, distribution, adaptation, and reproduction in any medium, provided that the original work is properly cited.
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Authors are permitted to post their work online in institutional/disciplinary repositories or on their own websites. Pre-print versions posted online should include a citation and link to the final published version in Journal of Librarianship and Scholarly Communication as soon as the issue is available; post-print versions (including the final publisher's PDF) should include a citation and link to the journal's website.
