The Nigeria Employers’ Consultative Association, NECA, has advised the Federal Government to eschew pride and review the removal of fuel subsidy and the floating of nation’s currency, the naira, warning of looming unemployment crisis, particularly with the current harsh economic situation.
NECA’s position came on a day oil marketers, under the aegis of the Natural Oil and Gas Suppliers Association of pleaded with President Bola Tinubu to peg the exchange rate of the naira to the dollar at the 2024 budget benchmark of N750/dollar.
Reviewing the twin policies of fuel subsidy removal and floating of the naira by the present government, NECA, the umbrella body for employers in the country, lamented that since 2023, government has been implementing policies that do not support operations of the private sector which are the largest employers of labour in the economy.
Director-General of NECA, Mr. Adewale- Smatt Oyerinde, who spoke on behalf of employers in the country, argued yesterday: “Some of the policies that are inimical to business include the currency redesign policy of the CBN, removal of fuel subsidy, floating of the foreign exchange, increase in various taxes, including excise duties and most recently, upward review of the foreign exchange rate for clearing of imports by the Nigeria Custom Service.
“Also included in this is the banning of alcoholic beverage in sachets and pet bottles of less than 200m. These measures are swiftly dragging most private businesses to the brink of collapse.
“The National Bureau of Statistics, NBS, reported a rise in unemployment rate to 5.0 per cent in the third quarter of 2023, from 4.2 per cent in the second quarter of the year.
“The figure is a product of the new methodology adopted by the bureau, which defines unemployment as the ratio of the working-age population to the total labour force. Retrospectively, using the old methodology for the last time, NBS reported unemployment at 33.3 per cent for the first quarter of 2021.
“Going by analysis done by Klynveld Peat Marwick Goerdeler, KPMG, using the old methodology, the estimated unemployment rate for 2023 is projected to close at 40.6 per cent, a 2.9 percentage point rise over the 37.7 per cent recorded in 2022. “The rise in unemployment rate by 80 points during the quarter could be a presage of looming unemployment crisis in the country, particularly with the current harsh economic condition.
“Therefore, to circumvent such crisis, it is important to question the causes of the current spike in unemployment rate and decipher solutions to mitigate further degeneration in the index. “Since 2023, government has been implementing policies that do not support the operations of the private sector. Incidentally, they are the highest employer in the economy.’’
While expressing dismay over the recent exit of GlaxoSmithKline, a multinational pharmaceutical company and Procter & Gamble, two companies that had operated in the country for decades, Oyerinde noted: “As the economy stands, there are many more companies to join the exit train or close shop if the current harsh operating environment persists.
‘’The implication of the poor macroeconomic and business environments on employment is grave as many businesses are down-sizing as a way of cutting costs to remain afloat.
