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Salaries of Nigerian workers drop, as manufacturers battle to survive

  • Business

The National Bureau of Statistics (NBS) has revealed that the salaries of Nigerian workers had dropped to a 21-month low.

NBS stated this in its Nigerian Gross Domestic Product Report (Expenditure and Income Approach) report published over the weekend.

According to the report, the compensation of employees (wages and salaries) in real terms fell to 3.93 percent in Q2 from 6.48 percent in the previous quarter.

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It dropped by 15.51 percentage points on a year-on-year basis from 19.44 percent in Q2 2021.

The slow compensation for employees has again revealed the severe impact of FX shortages, and rising energy costs on operating cost of companies.

A cursory analysis of some listed fast-moving consumer goods companies showed their costs of sales rose by 25.3 percent to N746.6 billion in the first half (H1) of 2022 from N595.4 in the same period last year.

In another component of the report, NBS revealed that household consumption expenditure in Q1 and Q2 2022 grew by 6.94% and 17.64% in real terms, year on year.

However, the growth rates in Q1 and Q2 of 2022 were lower than the rates recorded in Q1 and Q2 of 2021 respectively.

Interestingly the disposable income of Nigerians improved in 2022 according to NBS.

This indicates that while Nigerians have so much cash at hand, many are unwilling to spend.

Disposable income is what is left over after taxes, and is what households use for consumption of needs and wants.

According to NBS, the national disposable income grew by 2.00% both in Q1 and Q2 of 2022.

Source: Ripples Nigeria