Reduce workers’ living costs, CPPE urges FG

The Centre for the Promotion of Private Enterprise (CPPE) has put forth a compelling argument that goes beyond the usual demands for higher wages, urging the Nigerian government and labor unions to shift their focus towards addressing the fundamental drivers of the high cost of living. In a policy brief, the CPPE, through its CEO Dr. Muda Yusuf, highlighted that while wage adjustments are necessary, they are insufficient on their own to improve workers' welfare, especially in an economy plagued by persistent inflation and structural challenges.

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While wage adjustments are necessary and often justified, they are clearly insufficient as a standalone strategy for improving workers’ welfare. In an economy characterised by persistent inflationary pressures, structural bottlenecks, and weak public service delivery, nominal wage increases are frequently eroded within a short period.

The think tank's stance emphasizes the critical need to protect the real incomes of Nigerian workers, arguing that this will yield more sustainable welfare gains than periodic nominal wage hikes. The brief points to rising food prices, transportation costs, and housing expenses as the most immediate threats to household budgets, particularly for low- and middle-income earners who spend a dominant portion of their income on these essentials.

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Rising food prices, transport fares, and housing costs remain the most immediate threats to workers’ welfare. Tackling these cost pressures will deliver more durable welfare gains than periodic wage increases.

This perspective from the CPPE, a body that advocates for private enterprise, suggests a need for deeper, structural reforms. Instead of just negotiating salaries, the CPPE is calling for proactive government policies. These include significant investments in public transportation to lower commuting costs, measures to increase agricultural output and control food inflation, and strategies to stabilize rental prices in urban areas. The organization also proposes that medium and large enterprises, along with government institutions, should consider providing subsidized staff canteens to further alleviate the financial burden on employees.

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Labour advocacy should therefore prioritise structural interventions that address these cost drivers.

The CPPE's position resonates with recent statements from the Nigeria Labour Congress (NLC), which also stressed the importance of macroeconomic stability, noting that even substantial wage increases would be meaningless if the national currency continues to devalue. This shared concern underscores a growing consensus in Nigeria that sustainable economic improvement requires a multi-faceted approach, tackling both immediate needs and underlying structural issues.

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Even if Nigerian workers earn N1m, it will not be meaningful if the naira has no value. What we are looking for is a currency that can sustain workers and their families at least to the end of the month.