The debate over workers’ welfare and business sustainability is set to dominate industrial relations discussions in the coming months as organised labour has announced plans to begin negotiations for a new national minimum wage in July, barely two years after the implementation of the current N70,000 benchmark.
Leaders of the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) disclosed the plan during a joint press briefing on the sidelines of the 114th International Labour Conference in Geneva, Switzerland, arguing that prevailing economic realities have significantly eroded the value of workers’ earnings.
The labour movement noted that several state governments have already acknowledged that the current N70,000 minimum wage is inadequate to meet the basic needs of workers amid persistent inflation, rising transportation costs and increasing prices of essential goods and services.
While welcoming efforts by some governors to improve workers’ remuneration, labour leaders cautioned against unilateral wage pronouncements, insisting that any nationally binding minimum wage must emerge through established tripartite negotiations involving government, employers and workers.
The unions also urged government at all levels to clear outstanding gratuity arrears and other entitlements owed to retired workers, stressing that improved welfare remains critical to boosting productivity and economic stability.
The planned review comes amid growing speculation that a new national wage benchmark could exceed N100,000, following decisions by some state governments to adopt higher wage structures for their employees.
However, the proposal has triggered concerns among employers and business groups, who argue that while workers deserve better pay, many private sector operators, particularly small and medium-sized enterprises (SMEs), are already struggling under the weight of inflation, energy costs, multiple taxes and weak consumer demand.
President of the Lagos Chamber of Commerce and Industry (LCCI), Leye Kupoluyi, said private businesses should not be compelled to automatically match wage levels approved by governments if economic realities make such payments unsustainable.
“National minimum wage does not necessarily mean private sector operators must pay their workers the same level if they cannot afford such a level at the time of introduction,” he said.
According to Kupoluyi, government must first address critical challenges affecting businesses, including infrastructure deficits, energy supply constraints and support for productive sectors of the economy.
He also expressed concerns about the country’s fiscal position, warning that rising debt servicing obligations could further constrain investments needed to improve the business environment.
Similarly, Director-General of the Nigeria Employers’ Consultative Association (NECA), Adewale Oyerinde, acknowledged that calls for wage increases reflect the harsh economic realities confronting workers but insisted that any adjustment must follow internationally recognised procedures.
“We commend the state governments for proposing the increase of the minimum wage to N100,000. This seems plausible in view of the biting economic situation,” Oyerinde said.
He stressed, however, that wage determination must be based on empirical data and negotiated through the tripartite process recognised by the International Labour Organisation (ILO), rather than political declarations.
“While the government can, at a bipartite engagement with the unions, agree on what the wages would be, that cannot be binding on the organised private sector,” he said.
Oyerinde argued that reducing the cost of living through economic reforms could have a more lasting impact on workers’ welfare than what he described as an irrational increase in wages unsupported by productivity growth.
For many business owners, the challenge goes beyond willingness to pay. They argue that survival has become increasingly difficult in an operating environment characterised by high production costs and declining profitability.
National Vice President of the National Association of Small-Scale Industrialists, Segun Kuti-George, said while higher wages may be desirable, they are not immediately feasible for many businesses.
“MSMEs are already groaning under the burden of increased production costs and the consequential decline in profit margins,” he said.
President of the Association of Small Business Owners of Nigeria (ASBON), Dr Femi Egbesola, echoed similar concerns, noting that the capacity to implement a N100,000 minimum wage varies significantly across sectors and company sizes.
“The move by some state governments to raise the minimum wage to N100,000 is commendable and reflects the reality of the rising cost of living,” Egbesola said. “However, whether the private sector can match this level depends largely on the size, capacity and financial health of individual businesses.”
He noted that while larger corporations may be able to absorb higher wage costs, many SMEs are grappling with inflationary pressures, rising energy bills and weak consumer demand.
Egbesola called on government to focus on reducing the cost of doing business, arguing that a more supportive economic environment would enable employers to pay higher wages sustainably without sacrificing jobs.
Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, observed that wage structures already differ widely across sectors of the economy.
According to him, industries such as banking, oil and gas, and information technology already pay significantly above N100,000, with some firms offering entry-level salaries of between N150,000 and N200,000.
However, he said sectors such as manufacturing, agriculture, retail, hospitality and education continue to struggle with rising operational expenses.
“For many small businesses, it is a struggle to even keep the business afloat. That is the reality,” Yusuf said.
He added that many enterprises are yet to fully comply with the existing N70,000 minimum wage because of soaring energy costs and weak consumer spending.
Industry stakeholders maintain that improving infrastructure, stabilising energy costs, addressing insecurity and creating a more business-friendly environment would ultimately provide a stronger foundation for sustainable wage growth.
For labour unions, however, the issue remains straightforward: Nigerian workers deserve a living wage that reflects current economic realities and protects them from worsening hardship.
As negotiations commence next month, policymakers, employers and workers will once again face the difficult task of balancing the need for improved incomes with the imperative of sustaining businesses and preserving jobs in Africa’s largest economy.
