The economic situation in Nigeria has worsened for workers due to inflation and currency devaluation, which have led to a decrease in real wages. On International Workers’ Day, Nigerian workers met to discuss their concerns about their financial conditions that have been deteriorating amid rising living costs.
According to the National Bureau of Statistics (NBS), inflation has increased significantly, rising from 11.25% in March 2019 to a staggering 33.2% by March 2024. The devaluation of the naira has worsened the situation, and the minimum wage now stands at only $23, making Nigerian workers some of the world’s lowest earners, just above Bangladesh. This is particularly concerning given that in April 2019, when the national minimum wage law was adjusted, the minimum wage was $88.33 based on the exchange rate at that time.
The cost of basic necessities has skyrocketed, making life unaffordable for the average Nigerian worker. For example, the price of foreign rice has increased from N7,000 in 2018 to N70,000 in April 2024, while local rice has seen a similar increase from N12,000 to N60,000. Other staple foods have also seen price hikes of over 100%, putting a strain on the budgets of ordinary Nigerians. These price increases can be attributed to several factors, including currency devaluation and the removal of fuel subsidies, which have led to increased transportation and production costs.
On May Day, workers from various sectors expressed their dismay at their eroded purchasing power. They highlighted that current wages are insufficient to cover basic needs and called for urgent action to address these economic hardships. The sentiment was clear: the minimum wage needs an urgent revision to align with the economic realities.
However, the response from political leaders has been slow, with the ongoing negotiations for a new minimum wage dragging without clear outcomes. President Bola Tinubu, who had promised to improve the workers’ conditions, was notably absent from May Day celebrations. He attended a forum abroad instead, which was symbolic of the perceived neglect by the government towards the urgent needs of workers.
Leaders from various labor unions, including the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC), have been vocal about the dire state of affairs. They emphasized that the theme for this year’s May Day, ‘People First,’ calls for a recommitment to policies that ensure fair wages, job security, and access to essential services. Labor leaders have orchestrated multiple calls to action in the past year, urging the government to prioritize economic reforms that directly benefit the workforce.
Economic experts have pointed out that the cycle of low wages and high inflation is a significant contributor to the nation’s deepening poverty. Addressing this cycle requires comprehensive economic strategies that include stabilizing the currency, controlling inflation, and boosting employment through supportive policies for industries most affected by economic downturns.
The impacts of these economic challenges are far-reaching, affecting not just the workers but the overall economic stability of the country. Reduced consumer spending, a direct consequence of lower purchasing power, stifles business growth and limits the government’s tax revenue, creating a vicious cycle that hampers economic recovery and development.
As Nigeria continues to grapple with these economic challenges, the resolve of its workers remains firm. The call for a revised minimum wage is growing louder against the backdrop of increasing living costs and economic uncertainty. The government’s response in the coming months will be critical in determining the trajectory of the nation’s labor market and its overall economic health. The need for policies that foster economic growth and provide real improvements in workers’ living conditions has never been more urgent.
Source: The Guardian
