Employers may lay off workers amid worsening economy – NECA

Adewale-Smatt Oyerinde, the Director General of the Nigerian Employers Consultative Association has expressed concern that Nigeria’s deteriorating economy may result in employee redundancies.

The decline of the naira in Nigeria had a persistent impact on organizational activities.

Numerous companies in Nigeria have shut down their operations, mainly due to economic difficulties as the prime factor.

As the economy worsens, employers are exploring innovative strategies to stay afloat. Meanwhile, employees are beset by anxiety as their wages lose value due to the devaluation of Naira.

The Nigerian economy is currently in a state of dependence.

During an interview with Saturday PUNCH, Adewale-Smatt Oyerinde, the Director-General of NECA suggested that reducing staff numbers could be a viable option for employers to survive amidst the current significant depreciation in value of Nigerian currency.

He observed that the weakening of the naira results in reduced working capital for businesses and decreased output volume.

Oyenride said, “Once businesses are constrained to lower capacity utilization and output level due to the dissipation of their working capitals resulting from the gross depreciation in naira value, they (employers) will naturally consider all options available for survival, including staff reduction.

“A significant proportion of businesses in the country depend on imported raw materials and machines; therefore, the erosion in the naira’s value tends to shrink the working capitals of these businesses and lower their volume of output.”..[CONTINUE READING HERE]>>