The minimum wage has been defined as the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period, which cannot be reduced by a collective agreement or an individual contract. The implementation of minimum wage is to protect workers against low pay. They help ensure a just and equitable share of the fruits of progress to all. And a minimum living wage to all who are employed and in need of such protection.
Minimum wages can also be one element of a policy to overcome poverty and reduce inequality. Including those between men and women, by promoting the right to equal remuneration for work of equal value.
In a publication by The Conversation, the first minimum wage paid to Nigerian workers was 125 Naira per month in 1981. The last minimum wage which was 30,000 Naira was first implemented in 2019. Over the years, there have been reviews on the minimum wage to accommodate inflation and the increasing cost of living. The adverse effect of inflation on the Nigerian economy was taking a toll on the common citizen. As the country struggles with rising inflation currently at 34.19% and the reduction in purchasing power of workers, the proposed minimum wage increase aims to address these challenges faced by workers.
This topic of discussion has been on the lips of the average Nigerian because it affects them in one way or the other. Lawmakers, economists, and public service workers, especially those in the education sector are not left out. The Education sector is as important as any other sector, which is why the effects of this increment need to be critically examined and this article aims to achieve that.
Current minimum wage and proposed wage
From 1981 to 2018, Nigeria’s minimum wage changed three times. In 2000, it was increased to 5500 Naira. In 2011, it was increased from 7,500 Naira to 18,000 Naira. In 2019, the minimum wage was increased to 30,000 Naira and this led to the enactment of the National Minimum Wage Act 2019 in March 2019.
The Minimum Wage Act of 2019 expired in April 2023 according to its provision. Talks have then been in place before an agreement was reached between the Labour Congress and the Government.
The major unions (National Labour Congress and Trade Union Congress) suspended a strike in early June to give negotiations a chance but warned that failure to reach an agreement could prompt members to call for new action. The new minimum wage as announced on July 18, 2024 by the Minister of Information, Muhammed Idris is now 70,000 Naira. Which is six times lower than what the union was demanding (615,000 naira). According to the Minister of Labour, the implementation of this new wage will commence on May 1, 2025.
Impacts on Education Sector Workers
The minimum wage increment for education workers in Nigeria is a welcome development with far-reaching implications. While it poses some challenges, such as an increased financial burden on the government and potential inflation, the benefits outweigh the drawbacks. The increment will improve the standard of living, morale, and motivation of education workers. Leading to better job performance and reduced brain drain. The impact of the minimum wage increment on Education sector workers varies, influencing their economic, and financial decisions. It also affects their economic stability, work output, and quality of life. This section aims to discuss the benefits and disadvantages of this increment.
One benefit of this increment is that there is a boost in the earnings of workers, thereby improving their cost of living. This can reduce financial stress and improve the standard of living. The general aim of this increment is for citizens to be able to afford basic needs. This increase will enable workers to afford better housing, good healthcare, and education for their children.
Disadvantages of Minimum Wage Increment on Education Sector Workers
According to the Punch newspaper, the Federal Government will spend three trillion Naira (3trn) on minimum wage, pensions, and other gratuities. Minimum wage increments will increase the financial burden on the government. Potentially leading to higher taxes or diversion of funds from essential sectors. This change might also cause inflation, as businesses could raise prices to cover higher labor costs, resulting in unemployment.
The wage increase could widen the payment disparity between federal and state education workers, possibly leading to strikes. And the increment might not come with sufficient funding, causing delays or unpaid salaries, as seen in the past. Small private schools, in particular, might struggle to implement the wage increase, potentially leading to their closure.
Advantages of Minimum Wage Increment on Education Sector Workers
The minimum wage increment will enhance the standard of living for education workers by increasing their take-home pay, enabling them to meet basic needs. This boost can improve morale and motivation, leading to better job satisfaction, reduced absenteeism, and increased productivity. A competitive wage can also reduce brain drain by discouraging workers from seeking better-paying jobs abroad.
Higher wages will likely stimulate local economies and contribute to Nigeria’s economic growth. Additionally, the increment can reduce strikes and unrest among education workers, fostering a more stable learning environment. Attracting and retaining top talent becomes easiest with higher wages, reduces “japa” syndrome, and can improve the quality of education. By increasing the minimum wage, the government can help reduce poverty and income inequality among education workers and their families. Overall, a motivated and well-compensated workforce is likely to enhance the quality of education in Nigeria.
It will also stimulate economic activity, reduce poverty and inequality, and ultimately enhance the quality of education in Nigeria.
The increment of the minimum wage shows that the government is putting efforts and measures in place to reduce financial hardship in the country. As the government implements this policy, it is crucial to ensure timely payment, address disparities, and also provide necessary support to minimize potential negative consequences. With proper management, the minimum wage increment can be a significant step towards revitalizing Nigeria’s education sector and empowering its workforce.
