… Inflation Erodes Gains of New Minimum Wage
Civil servants across Nigeria have expressed frustration over the rising cost of living, which has rendered the new minimum wage of N70,000, signed into law by President Bola Tinubu on July 29, 2024, nearly ineffective.
Amid worsening inflation, the Nigeria Labour Congress (NLC) in October warned of the possibility of demanding a fresh review of the minimum wage. NLC President Joe Ajaero, speaking at the 8th Quadrennial Delegates Conference of the National Association of Nigeria Nurses and Midwives (NANNM), decried the economic challenges faced by Nigerians, calling for unity to combat the forces exacerbating the crisis.
Ajaero stated:
“As it stands, our options are limited. We must either collectively resist the forces keeping us down or succumb to them in hopelessness. The trade union movement is the only viable force to challenge neoliberalism and mitigate its impact on our nation. Together, we must counter their profit-driven agenda, which comes at the expense of social welfare.”
Since then, the situation has worsened. Analysts believe recent government actions, such as the 50% tariff hike for telecoms, could further drive inflation, which currently exceeds 34%. President Tinubu’s promise to reduce inflation to 15% by year-end has been described as overly optimistic.
Dr. Dorka Ikechukwu, a medical professional at a government hospital in Lagos, highlighted the disconnect between the minimum wage and the cost of living:
“Inflation has nullified the benefits of the new minimum wage. Food prices remain exorbitant, transportation costs are high, and the wage simply isn’t enough. The government must address inflation, as it eats up our income entirely.”
Similarly, financial analyst Frank Egwim noted that inflation has eroded workers’ purchasing power:
“With a minimum wage of N70,000, a bag of rice now costs between N91,000 and N95,000. Before the wage hike, the same bag was N30,000 to N40,000. The situation is worse in states that haven’t implemented the new wage. Without reducing inflation, the wage increase is meaningless.”
Ms Obehi Iyama, a schoolteacher in Benin, called for transparency in wage calculations and urged the government to fulfil its promises:
“We appreciate the minimum wage, but expenses far exceed our income. The government must clarify how the wage increment is calculated and ensure the promised 70% raise is fully implemented. Rising food prices leave us struggling daily.”
Minister of State for Labour and Employment, Nkeiruka Onyejeocha, assured workers that the minimum wage would be reviewed within two years:
“President Tinubu is committed to improving workers’ welfare. Unlike the five-year cycle, the next review will happen in three years, less than two years from now.”
She reaffirmed that the president’s commitment to workers’ welfare is well-documented and would be upheld.
