In a bid to reduce the impact of rising inflation and the economic effect of subsidy removal, Nigerian banks have reevaluated their employee benefits by increasing salaries and wages, a development aimed at prioritising the well-being of the workforce during times of economic uncertainty.
This development may as well be coming from the bank as a result of Nigeria’s inflation rate which has now risen 22.79 percent in June from 22.41 percent in the previous month.
For instance, Wema Bank raised the salaries of its employees to cushion the effect of fuel subsidy removal citing “current economic realities.”
“Wema Bank’s vision extends beyond its bottom line; with this salary increase for its staff, the bank expects the ripple effect of positive change to extend to the wider industry and world of work,” Ololade Ogungbenro, the bank’s divisional head, people, brand & culture, said.
Guaranty Holding Company also announced on June 18 an increase in salaries for its junior and contract staff to help them cope with the increasing cost of living.
According to Business Day, the salary increase took effect from July 1, with cleaners now earning between N70,000 and N80,000, and drivers – between N140,000 and N150,000.
Zenith Bank also announced an implementation of a company-wide salary increment for all its staff to address the prevailing economic difficulties resulting from the removal of fuel subsidies.
Based on Zenith Bank’s new salary structure, findings showed a driver now earns about N120,000, while a cleaner earns about N80,000 as the increment was for both contract and permanent staff of the bank.
“The increase reflects the rising cost of living and worsening living standard, as average per capita income (which has been falling) has not kept up with the cost,” Damilola Adewale, a Lagos-based economic analyst said.
The recent removal of subsidy on petrol in Nigeria has had a widespread impact on individuals across the country, including employees who now face increased transportation expenses for their daily commute.
In addition, the rising inflation has led to higher fuel prices, causing public transportation providers such as buses, tricycles and motorcycles to raise transportation fares, accordingly. This situation has significantly affected those who rely on public transportation, particularly workers in the private sector.
With higher transportation fares, many employees are now forced to allocate a substantial portion of their salaries to cover commuting expenses, leaving little for other essential needs like food and rent.
Apart from GTCo and Zenith Bank, Fidelity Bank also commissioned more staff buses to ease the burden of commuting for employees.
In 2022, Ecobank Transnational was the highest-paying company in Nigeria. The transnational company recorded N54.83 billion in personnel costs in the first quarter of 2023, a 16.9 percent increase from N46.9 billion in the same quarter of 2022.
The personnel expenses encompass all of a company’s expenditures in relation to staff remuneration and welfare within a specific financial reporting period.
Access Holdings recorded N33.57 billion in personnel expenses in the first quarter of 2023, up 14.8 percent from N29.25 billion in the first quarter of 2022.
United Bank for Africa employee’s benefit expenses rose to N31.26 billion in the first quarter of 2023, a 22.2 percent increase from N25.58 billion in the first quarter of 2022.
FBN holding company’s personnel expenses stood at N31.3 billion in the first quarter of 2023, up 22.2 percent from N25.62 billion in the first quarter of 2023.
Stanbic IBTC Holdings’ staff cost amounted to N13.98 billion in the first quarter of 2023, a 13 percent increase from N12.38 billion in the first quarter of 2022.