A new chapter unfolds in Nigeria with the recent approval of N70,000 minimum wage. The announcement, met with jubilation and scepticism, also sparked a fervent debate among the populace and analysts alike......See Full Story>>.....See Full Story>>
Chidi Nedu, a public analyst, is at the forefront of this discourse. He believes more needs to be done to cushion the ongoing hardship:
“Creating a financial shield against poverty requires much more than a new minimum wage,” he said.
“There are macro and microeconomic factors that play a crucial role here. Inflation, cost of living, access to credit, access to healthcare, access to decent accommodation, among others, are key.”
Nedu’s analysis delves deeper, peeling back the layers of economic complexity that shroud the issue.
He further told Legit.ng:
“It is almost always a welcome development when the minimum wage is reviewed upwards but if it contributes further to the inflationary pressure, and exists within a climate of devalued currency amid high cost of living, its net benefit will be extremely low. This is the case with Nigeria.”
His critique is not without merit. The recent economic shifts—the removal of petrol subsidies, the flotation of the currency, and the increase in electricity tariffs—have all played a part in reshaping the financial landscape.
He explained further:
“The margin of upward review of the minimum wage—and more importantly, the consequential adjustments—cannot equate the radical changes to the price mechanism in the country. The minimum wage review can barely move the needle in light of the prevailing cost.”
Governors’ concern
Adding to the complexity, several state governors have voiced their concerns about the feasibility of implementing the new wage. Some governors have openly stated that their states lack the financial capacity to meet the N70,000 minimum wage, citing budget constraints and existing financial commitments. This struggle highlights the broader challenges of economic management and fiscal responsibility at the state level.
The approval of the new minimum wage was driven by a combination of factors, including the rising cost of living and the need to address widespread poverty. The government, in its statement, said it aimed to provide relief to workers who have been grappling with escalating prices for essential goods and services.
Jubilation as N200k approved for workers
Meanwhile, Legit.ng earlier reported that shipping agencies, under the aegis of the Shipping Agencies, Clearing, and Forwarding Employers Association (SACFEA), have approved a minimum wage of N200,000.
As reported by The Punch on Monday, August 26, the new pay applies to the association’s various employees.