The Managing Director of Financial Derivatives Company (FDC), Bismarck Rewane, has urged the Nigerian Labour Congress (NLC) to reconsider its demand for a minimum wage of N494,000, News About Nigeria reports.
He stated this while speaking at the 2024 Vanguard Economic Discourse with the theme “Reform in an Era of Global Economic Uncertainty: Whither Nigeria”, in Lagos.
He noted that if the Labour Congress insists on the minimum wage being paid with the current dollar exchange rate, it would result in massive job layoffs, especially among the private sector operators, who are the major employers of labour.
According to him, there are several more macroeconomic challenges facing the private sector, adding that these challenges have eroded the revenue from which the minimum wage will be paid to workers.
Rewane also stated that for efficient price reforms to be achieved, they must be preceded by institutional reforms that would ensure that the right set of people are emplaced in positions of authority, and he maintained that the naira will also continue to depreciate in value if the country does not earn dollars via export.
“In 2019, the original proposal that we met when Buhari called us, I could recall, was N18,000, and the discussion was around N24,000. I think we moved it to N30,000 after all the negotiations.
“When we came up, he said, I don’t want any layoffs, I don’t want any inflation, I don’t want this, and I don’t want that. But what do you want? That was not there.
“The equivalent at that time was about $75. So, for any other person, if you are on N18,000, you get N30,000. If you are a permanent secretary, whatever it is, you get N10,000 more.
“And the data is here. Inflation in 2019 was 11.4%. Inflation in 2020, the year after, came down to 6%. So, you can see that even though there was a wage review, which went from N18,000 to N30,000, inflation actually declined to 6 percent,” he stated.
He also argued that if the minimum wage is dollarised, then income must also be dollarised because inflation has already been factored into the exchange rate.
“And now, if you use the dollar value, you must also use U.S. inflation. You cannot use the dollar value and then use the Nigerian inflation because that means that I am paying you in dollars,” he added.
He, therefore, appealed to organised labour to reconsider its demand to avoid workers being laid off from their jobs due to the inability of employers to pay the wage.
