A Minimum wage refers to compensation made to an employee after performing labor, the minimum wage can be determined on a contract basis or through legislation by the government.
Across the world, the minimum wage to be received by workers varies from country to country. As opposed to developed countries like the United States of America whose minimum wage is at $15,080.00. Nigeria still struggles to meet the Nigeria Labor Commission (NLC) descent wage demand for its employees.
Why is Nigeria Stuck?
Some other African Countries such as South Africa is far beyond reach as far as Nigeria is concerned, an increase in minimum wage produced effect this year in South Africa with an equivalent of N126, 480 to be received by every employee monthly compared to Nigeria’s N30, 000 minimum wage per month. Here are some of the reasons why Nigeria is stuck
The Boko Haram issue
Nigeria struggles to defeat Boko Haram is the cause of financial instability in Nigeria. Investors are always attracted to places that they feel safe and currently as the things are not favorable as it was and should be.
It is evident that desperation is experienced across Nigerian government with one of the leaders quoted asking the president to appoint him as a leader of the task to lead the team to Sambesi forest to hunt down Boko Haram. The Nigerian insecurity has hindered both foreign and local investment adding to its economic problems.
Being an African Country with the largest population, Nigeria has experienced loss of life in the northeastern part which is believed to be led by jihadist’s militia. The government has allocated lots of funds in recent years and as a result, compromising the share that the business market should be receiving.
The base of this political instability can be projected from the growing divisions among the different population as a result of religious differences- the report shows that Christians have flown from the northern part of Nigeria as a result of growing Islamic law in the region.
Trade policy issues
Despite being Africa’s largest oil producer, Nigeria still struggles to deal with high inflation rates and low currency exchange rates as compared to neighboring African countries like South Africa.
As at now, 1 South African Rand has an exchange rate of N26.35 which is a wide gap. With elections around the corner, there is the likelihood that the economy may be frozen to give the opportunity for some leaders to sell their ideas to the public- in the name of changing the country’s status quo.
A report from Washington-based Brookings institution has shown increasing levels of poverty is a risk factor that might derail Nigeria a nation with an approximation of 87 million people without a job.
The number is alarming, growing frustration among young men and women may force most of them to resort to join militia groups and end up compromising security.
To reverse this trend, Nigerian government needs to focus on ensuring political stability along with other policies such as health reforms on family planning- this will be key in reducing unemployment rates, focus more on security issues and with economists saying that Nigeria needs to create more than four million new jobs to reduce poverty levels and create descent wages above the current minimum wage