The National Directorate of Employment (NDE) was established in November 1986. It began operations fully in January 1987. The birth of the Directorate was predicated on the effects of the economic recession of the ’80s which led to a drastic reduction in capacity utilization and consequent outright closure of industries in Nigeria. Equally, other macro-economic policies of the government of the day such as the Structural Adjustment Programme (SAP), devaluation of the Naira, privatization and commercialization of the economy, etc. resulted to massive job losses in both the public and private sectors of the economy.
As a direct response to the rising trend of unemployment, the then military government headed by General Ibrahim B. Babangida, set up a committee headed by Mr. Stephen O. Chukwumah (the Chukwumah Committee). The Committee was charged with the task of proffering a sustainable interventionist solution to mitigate the rising levels of unemployment in Nigeria. The Committee established that the informal sector of the national economy had operators and employees who were mainly low skilled, semi-skilled and or unskilled. This group also constituted about 90% of the workforce within the sector. This situation therefore, placed skills acquisition/training on the front burner in respect of employment creation.