• Wednesday, June 19, 2024
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BusinessDay

Minimum wage, maximum pain: Workers’ hope of bumper salary raise dashed

Democracy Day:  Tinubu vows to protect rights of every Nigerian

…As FG proposes N48,000, a far cry from Labour’s N615,000 demand

The past year has been very traumatising for many Nigerian households. The removal of petrol subsidies which raised pump prices from N198 per litre to over N600 per litre has been putting pressure on Nigerian homes.

Many families now struggle to pay mounting bills and at the same time put decent meals on the table due to the escalating inflation and food prices. Rising inflation has reduced households’ purchasing power, especially with prices hitting the rooftop while salaries remained the same.

Read also: TUC condemns N48,000 proposed minimum wage, says it can’t buy a bag of rice

The situation has affected virtually all aspects of human life such that households are beaten from all sides of life. Bills such as house rents and school fees have also doubled.

This explains the call on the Federal Government by the Labour unions for an upward review of the minimum wage.

Minimum wage is the amount of remuneration that an employer is required to pay wage earners for the work performed during a given period, which cannot be reduced by a collective agreement or an individual contract.

On April 18, 2019, President Muhammadu Buhari signed a law that raised workers’ minimum wage from N18,000 to N30,000 about $20 at an exchange rate of N1,497.33 per dollar.

This move by the then government was received with so much admiration but today, the narrative has changed as the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) have jointly protested that the present minimum wage can no longer sustain an average Nigerian going by the current economic situation.

They called on President Bola Ahmed Tinubu to begin the review of the wages to reflect the current economic realities in the country.

The Unions recently proposed a raise to N615,000 but the Federal Government said it could raise the wage from N30,000 to N48,000 about $32.06.

This represents an N18,000 up from the N30,000 minimum wage that has long become out of tune with the economic realities in society.

However, Joe Ajaero, president of NLC, and Etim Okon, deputy president of the TUC, said Nigerian workers would not accept N48,000 as the new minimum wage being proposed by the Federal Government.

They said it does not reflect the economic reality and hardship the workers are currently facing in the country.

Soaring inflationary pressure on household

Since the economic reforms of the Tinubu administration that led to the removal of petrol subsidies and foreign exchange liberalisation, many Nigerian homes have been witnessing economic hardships due to the galloping inflation and consistent weakening of the naira.

Nigeria’s inflation accelerated to 33.69 percent in April while food inflation rose to 40.53 percent in April, compared to the 24.61 percent reported in the same month last year, according to the National Bureau of Statistics (NBS).

With the soaring Nigerian inflation rate, prices of various items including food and transportation fares have continued to skyrocket beyond the reach of the poor.

For instance, the prices of garri, rice, bread, beans, yam, proteins such as eggs, chicken, meat and other food items have grown astronomically.

BusinessDay Sunday discovered that a paint bucket of garri now sales for N3,500 from N1,000; a bag of rice sales for over N70,000 from less than N40,000; a loaf of bread now sales for N1,300 from N750, and the pump price of petrol goes for over N600 per litre from N198 per litre.

Households are now spending a chunk of their salaries on food alone even as consumers’ purchasing power dwindles. This is why Nigerians believe that N30,000 minimum wage is no longer a fair compensation for workers.

Nigerians speak

Shehu Sani, a former senator from Kaduna Central, said on his ‘X’ handle that N48,000 minimum wage is an ‘Almajiri,’ meaning a beggarly offer.

“48,000 minimum wage is an Almajiri offer to Labour, but quarter moi moi is better than non,” he said on his handle @ShehuSani on Thursday.

“Anybody earning a salary below N500,000 in Nigeria today cannot cope because the bills are piling up by day putting pressure on the already stretched wallet,” said Seyi Olaitan, a Lagos-based web developer.

He also said running a home has become a serious business with many bills to pay.

Olaitan, a father of two children, said that after paying house rent and children’s school fees, it’s now difficult to put decent meals on the table, pay daily transport fare to work and take care of his elderly parents.

He further said that the pressure forced him to resign from his former workplace where he was earning N200,000 a month because the money was no longer paying his bill.

“I am not a civil servant but I can’t see myself earning N48,000 in today’s Nigeria because that cannot pay for my family feeding for two weeks not to talk about other expenditures, ” Olaitan said.

Juliet Eromosele, a nurse, said several things are now wrestling with people’s income.

She said transport fare alone takes a chunk of her pay as she spends over N50,000 on transport monthly.

“Food is expensive, petrol is out of reach, transport is on the high side while salary remains the same yet a government that claims it sees the plight of its subjects is proposing to pay someone a minimum wage of N48,000. It is unrealistic,” Eromosele said.

Civil servants speak

With the rising inflationary pressure in the country, many civil servants are battling to keep their heads above troubled waters.

The situation has reduced some of them to begging and borrowing to feed and transport themselves to work.

People are struggling to pay rent while those who have the means are leaving the country in droves, a situation presently known as the ‘Japa’ wave.

Emeka Duru, a mid-level civil servant, told BusinessDay that the Federal Government should propose a minimum wage of at least N200,000 because the prices of food items have risen by over 400 percent.

He also said that N48,000 makes a mockery of Nigeria’s civil service given the rising cost of living crisis.

“Even N150,000 as a minimum wage is insufficient. A bag of rice now costs over N60,000, and prices of other food items have increased by over 400 percent. Workers in Nigeria have been on a ‘hunger strike’ since the removal of the petrol subsidy in May 2023.

“The Federal Government is not being realistic with its proposal. When the minimum wage was N18,000, we were buying fuel at N87 per litre. Now, fuel costs as much as N1,000 per litre. Based on empirical reasoning, the minimum wage should not be below N200,000,” Duru said.

Adenike Lawal, another civil servant, said the rising cost of living and economic hardship in the country are frustrating lives.

“N48,000 minimum wage is abysmal, wicked, and evidence that this government does not mean well for the masses. Almost every aspect of the economy has experienced a minimum of a 100 percent increase, with some up to 500 percent. This has eroded the purchasing power of the masses. The minimum amount that will allow Nigerians to maintain their pre-Tinubu era economic status is a minimum wage of at least N250,000 monthly,” she said.

According to her, “Civil servants no longer eat for nutrition but to fill our bellies. Having a roof over our heads no longer seems like a basic need because the salary cannot afford decent accommodation. The cost of transportation alone consumes the monthly pay, leaving feeding, clothing, shelter, and children’s education at the mercy of God,” Lawal said.

She however, called for a review of the wages of the political officeholders.

Lawal said the wages of Nigerian political officeholders should be pegged as a ratio of the national wage to ensure no politician earns more than five times the minimum wage, including allowances.

Also speaking, Akeem Busari, another civil servant, criticised the proposed N48,000 minimum wage by the Federal Government, pointing out that it cannot even cover the cost of a bag of rice, garri, or beans, which illustrates the severe economic hardship and hunger Nigerian workers are enduring.

“Honestly speaking, the Federal Government is not being realistic about the situation in the country and the plight of Nigerian workers. Civil servants now find it hard to make ends meet due to high taxes and overwhelming expenses. It has been very tough for us, and we pray to God to help us,” Busari added.

State governors’ position

Amid the controversy, the 36 state governors under the aegis of the Nigeria Governors Forum (NGF), said they are reviewing their individual fiscal space and the consequential impact of various recommendations to arrive at what they described as an improved minimum wage that states can pay sustainably.

They promised that better wages would be the inevitable outcome of ongoing negotiations.