New Minimum Wage For Nigerian Workers

Written by NaijaEcash

Topics: Nigerian, small business

Should Government Workers Celebrate The New Minimum Wage?

Government workers in Nigeria are getting excited about the newly approved minimum wage of 18,000naira. Does this really call for jubilation? I’m not trying to be pessimistic, but I personally feel that what Nigerian workers need is not a new statutory minimum wage. They will be better off if the government focus her attention on arresting the factors responsible for eroding the purchasing power of the workers income. If the present attitude of our leaders in maintaining the social infrastructures continues, the newly approved statutory minimum wage will have less than the purchasing power of the old 7,500naira minimum wage.

It is not the volume, but the value!

I personally feel that everyone would have been better off, if government has concentrated on improving the supply of electricity and repairing the roads. Those two factors alone cost an average worker thousands of naira per month. so much fund is wasted from each workers income as they struggle to provide energy using petrol generator.  The cost of transportation is also high because commercial vehicle owners pay heavily for maintenance of their vechicle due to bad roads and poor road networks.

Will The State Government Pay?

The state governments are already crying foul over the federal government action. They claim they can’t afford to pay the new minimum wage. This shouldn’t come as a surprise to us, knowing fully well that some are owing their workers more than one month salary (at the old minimum wage rate). How on earth do we think such states will be able to pay their workers the new minimum wage which is more than 100percent increase on the old rate.

Will The Private Sector Pay The New Minimum Wage?

The private sector will now have to contend with disgruntled workers who will be expecting automatic increase in their salary because of the pronouncement of the Federal government. Unfortunately, many workers in private organisation will be dissappointed. Such automatic increase in salary is not realistic. Presently, a lot of private firm are having challenges with running their operations on diesel driven generator, because there is a hike in the price of diesel. Unlike before when a litre of disel sold for 110naira, now it goes for as much as 140naira per liter. That is a sudden increase in overhead expenditure.

Just two months into the new year and there are already many challenges for the Nigerian Entrepreneur to combat with. Unfortunately, our leaders are too pre-occupy with the April election to bother about the state of the economy. They are not helping matters in any way as their reckless spending is putting pressure on the economy. The warning from the Central Bank of Nigeria on the need for the executive to cut down on recurrent spending seems to be falling on deaf ears.

Nigerian entrepreneurs need to re-strategize in order to cope with the unforeseen result of these government policies. Every wise entrepreneur need to watch his/her overhead expenditure this year. It is obvious that there are challenges ahead. What is your opinion about the new minimum wage?

16 Comments Comments For This Post I'd Love to Hear Yours!

  1. John says:

    Post updates to me

  2. Great post! As you have rightly said “Will the Government Pay”?. Thank you for sharing

  3. makemoney says:

    I think the various state Governors would find it difficult to implement ans start paying the new minimum wage
    makemoney´s last blog post ..UNBELIEVABLE FACEBOOK WEALTH

  4. Alex says:

    Kind of the same thing happened in my country too. But after they increased the minimum wage there were a lot of people who started to work illegally without any kinds of papers because the companies weren’t hiring people anymore because of the new minimum wage.

    I think the government should first think if they have the base to support this raise, instead of thinking of their next elections.
    Alex´s last blog post ..Jocuri cu masini

  5. Jane says:

    We’ve had the minimum wage in the UK for many years and it DOES help improve poverty levels. But, many employers still ignore the law and employ immigrants below the minimum wage. Forcing employers to obey the law won’t be easy.

  6. Jenny says:

    The minimum wage here is forced on a lot of employers except the farming
    industry, it should be the same across the board. All in all it should be fair all over the world not just in North America.
    Jenny´s last blog post ..Organic Market Garden Business Guide

  7. Adam says:

    Jubilation may not be needed, but the appreciation of the government workers of the said increase or the implemention of the minimum wage law is definitely worth something. Additional salary to what you’re currently getting is always a good thing, no matter how big or how little it is (hoping not too little that is).

    There’s no such thing as automatic increase in salary in my opinion, as there can be a lot of bylaws and company regulations to factor in, most especially with private sectors, less alone in goverments that could normally take months or years.

    Whether private sectors or the government both types of employers should take good care of their employees, and vice versa… as both will benefit the fruit of their own efforts. Just a thought.
    Adam´s last blog post ..How to Get Free Olive Garden Coupons

  8. Michelle says:

    It’s very hard to fight economically. In some countries in Africa most of the food is sent to Europe because even with transport costs, the farmers make more money selling food to Europe.

    It’s not just Nigeria that needs help, but the whole continent.
    Michelle´s last blog post ..Blocked drains london

  9. shola adawa says:

    am of the opinion that the new minimum wage,will increase the rate of unemployement in our nation.

  10. Kayla says:

    Apparently there’s talk of another global financial crisis. How will this affect the cost of living for Nigerians who have just been given this lift in minimum wage? Is this perhaps another reason for increasing it, because the GFS could be foreseen?

  11. Jeff W. says:

    I thought I had it bad. I wish the best for y’all.

  12. Ashezua,T.T. says:

    Its okay to increase workers salaries but at the same time government and private agencies efforts should be geared towards employing the teaming youths coming out of the universities every day.

  13. NESTA says:

    Government has no business doing business

  14. the new minimum wage will help the worker in this country to get a place they will call they home because 1/3 of the civil servant cannot take care of their family responsibilities

    • NaijaEcash says:

      I wish that will be the result of the increase. But the opposite is the reality! Every day, the purchasing power of Naira is getting eroded due to poor economic policies. Even when a technocrat manages to convince our leaders to accept a good economic policies, the saboteurs and sycophants that mill around our political leaders still end up truncating the implementation of such good economic policies.
      Pause for a second and consider these:
      1. The tariff for electricity has been increased. So part of the new wage paid to the worker will be spent on these. Also, the epileptic or non-existent of power supply still forces the Nigerian worker to generate his own electricity. That means a good percentage of the new salary will be spent fueling generators!
      2. The roads are getting worse. So cost of transportation are getting increased. In some places the cost of transportation have doubled due to poor roads! For the few workers that own vehicles, they will spend a substantial percentage of the new wage on constant repair of their vehicles due to poor roads!
      3. So much noise was made about the increase. So the average self-employed artisan, traders etc now look at the civil servants as ‘millionaires’ and they sure want to get their own cut of the national cake from the new wages. So they are busy inflating the prices of goods and services. And guess what they use as excuse, the poor roads!

      Invariably, the Nigerian workers in my own opinion are worse off than they were before the new minimum wage! If only the Nigeria Labour Congress leaders will dutifully consider these points, they will rather go on strike and insist that government must do the following:
      1. Improve electricity supply.
      2. Repair the bad roads.
      3. Provide portable water.
      4. Improve the public education sector.

      Sincerely speaking, those are the things that can improve the lives of the Nigerian workers. It will not put more cash in their pocket, but it will reduce what they have to spend generating their own electricity or paying for non-existing electricity supply. It will cut down their spending on transportation or vehicle maintenance, cost of providing portable water and cost of sending their wards to private schools.

      It is better to increase the purchasing power of the Nigerian naira than increase the volume in the hands of the workers while unwittingly reducing the purchasing power of the currency. Well, that is my candid opinion.

    • tonioslam says:

      mr.,minimum wage does not necesarily mean an increase in welfare. the whole thing is just not straight. simply, if this must be adhered to unemployment and inflation will rock the nation. a major support this minimum wage thing is getting is an expansionary monetary policy by the CBN.we should be thinking of making our markets competitive by increasing productivity and therefore giving the consumers wider range of choices. this will improve the overall living standards. finally, an increase in salary should be followed by an increase in productivity.

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