By Oladotun Fadeyiye
As public expectations toward the implementation of minimum wage heightens day in, day out, with Labour Union drumming the drums of threats to keep workers away from their work places until something worthwhile is done by the Federal Government about the agreed Minimum wage, the question we need to also ask ourselves is: Are we also getting set for the downsides and prices that will come with it???
There is no gainsaying that the Labour Union’s demand will eventually be met, if they press on with the ongoing strike action towards ensuring that the workers are given well deserving remuneration (Minimum wage) that would be sufficient to cater to their basic personal needs and their families.
However, the implementation of minimum wage will certainly not be without its downsides and price.
So what are these prices and downside?
Years ago, when Former President Olusegun Obasanjo signed the implementation of minimum wage into law for adequate compensation for the workers, I recall most private companies found it hard to comply with the policy.
Many of them claimed they weren’t government establishments so the policy was strictly for the government to implement alone.
Consequently, most individuals working in private organizations began to feel cheated and left out. Hence, that prompted many to abandon their jobs in the private sector and began to jostle for appointments within the civil service. This also led to a lot of ghost appointments and workers in the polity.
For some reason, only the government workers seemed to be favoured with such policy implementation thereby leading to reduction/loss of workforce within the private sector.
Moreso, with the current unemployment rate in the country which stands slightly above 50 percent as at 2023, one can only imagine the low impact such policy implementation would have on the overall Gross Domestic Product.
Furthermore, viewing from economic prism, the impact of minimum wage implementation will no doubt negatively impact the prices of goods in the market.
It will certainly trigger the “Nigerian factor” that played out when similar policy was first implemented in the early 2000s -when all the market women/sellers decided to spike up the prices of goods owning to the fact that the government had increased the salaries of the workers and the only way to be beneficiaries was by making them pay more for the goods purchased.
Now, that is the part where everyone including the beneficiaries and non-beneficiaries of this minimum wage will feel the pinch.
Already, the prices of goods particularly food items are nothing to write home in the country. Not to talk of the shortage of food items that are being purchased at rather exorbitant prices.
Currently, a small bowl of tomato costs somewhere around N6,500 while a tuber of yam in any local market in Abuja goes for N6000.
Let’s assume all above mentioned these prices are pre-minimun wage prices, now let’s imagine what these prices they will be, after the minimum wages have been implemented. It will be highly unbearable right?
Therefore, how do we think an average factory worker, artisans or a partially employed person who earns less than a dollar a day from their daily hustle would cope in such a situation? Particularly when most of them aren’t the direct beneficiaries of this scheme?
And now to the big question: Are there ways federal government hopes to cushion this negative impact on the socio-economic activities???
The answer to this big question will be the only determinant, if the minimum wage implementation will ever make any difference in the lives of the direct beneficiaries.