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HomeExecutive BriefBreaking the Ice: Minimum wage negotiations and economic Realities in Nigeria

Breaking the Ice: Minimum wage negotiations and economic Realities in Nigeria

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By Oludare Mayowa

The ongoing negotiations between the federal government and labour unions over the minimum wage appear unlikely to conclude amicably, contrary to the expectations of many.

The discussions have become protracted, with both parties firmly entrenched in their positions. The government has proposed a baseline wage of N62,000, while labour unions demand a minimum wage of N250,000, citing inflation and the high cost of living.

Assistant General Secretary of the Nigeria Labour Congress (NLC), Chris Onyeka has dismissed the government’s offer as insufficient, branding it a “starvation wage.”

Onyeka stressed that the unions will not settle for any figure below N250,000, stressing the disconnect between the proposed wages and the daily realities faced by workers.

The labour unions have shown some flexibility, acknowledging the need for negotiation. the President of the Trade Union Congress (TUC), Festus Osifo noted that while figures are not set in stone, the unions are prepared to continue pushing for a more substantial increase.

Osifo emphasized that the labour movement’s efforts will persist until a favorable Minimum Wage Act is enacted.

President Bola Tinubu has maintained that the minimum wage must be realistic and sustainable, stating, “The minimum wage is going to be what Nigerians can afford.”

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However, renowned economist Bismarck Rewane cautioned that raising the minimum wage without corresponding productivity increases could exacerbate inflation, already at 33.96%.

The question remains whether labour unions will resort to industrial action if the government and National Assembly uphold the N62,000 proposal.

While strikes are an option, insiders suggest that lobbying lawmakers may be a more strategic approach to achieving a higher wage.

Ultimately, while an increase in the minimum wage is necessary, it must be tied to productivity enhancements to avoid further inflation.

The labour unions should advocate policies that boost productivity and lower the cost of living. Measures such as improving security to enable farming, prohibiting open grazing to prevent crop destruction, and enhancing infrastructure and power supply are crucial steps.

Additionally, the labour should push for economic reforms that ensure equitable wealth distribution and place political office holders on minimum wage to curb governmental extravagance.

Effective governance at state and local government levels is essential to translate economic policies into tangible benefits for the populace.

Without such comprehensive reforms, any new minimum wage figure, regardless of its size, will fail to alleviate the economic hardships faced by Nigerians.

(Contact; omayowa@globalfinancialdigest.com; Newsroom: +234 8033 964 138)

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