Economic, Employment Growth Are Jointly Dependent -Opara | Independent Newspapers Limited
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Labour & Employment, Labour&Industry

Economic, Employment Growth Are Jointly Dependent -Opara

opara pictutre
Posted: Apr 5, 2016 at 3:00 am   /   by   /   comments (0)


 Comrade Bede Opara, National President of Senior Staff Association of Electricity and Allied Companies (SSAEAC) in this interview with Sylvester Enoghase, speaks on how addressing inequality, improving tax policies, investing in infrastructure;  which are all important elements of coherent, integrated packages, would boost overall growth and job creation.


 What is your take on the current challenges confronting growth and employment in the country?

The challenge of strengthening the link between growth and employment should be the Federal Government agenda as policy priorities will depend on Nigeria’s circumstances, especially now that the Government is looking for ways in which coordinated action can lead to positive international spillovers.

We are worried that Nigeria has experienced a sustained downward trend in the labour share of their national income, driven by significant losses in labour shares for middle- and lower-earning workers. This is a key factor in the shortfall in demand in the 36 states in the country and reversing these trends through labour market policies, as well as fiscal policies, can strengthen both overall growth and employment growth of the nation’s economy


How do you see the share of workers in vulnerable employment in the country?

The share of workers in vulnerable employment, which measures the share of own-account workers and contributing family workers in total employment, has declined since the crisis. However, over half of workers in 36 states from labour analysts are still engaged in vulnerable employment. Although these trends are moving in the right direction, the large share of workers that remain in vulnerable employment in the country  shows that informality, low pay and low productivity continue to be stubbornly large and significant on-going challenge.

I am pleased to note that a variety of proven measures and integrated strategies to encourage formalisation are set out in the recent ILO Recommendation 204 adopted by our tripartite global conference in 2015, and this provides a helpful framework for the Federal Government through the Ministry of Labour and Productivity as we go forward.


Sir, given the scale of the challenges we faced in the country,  is it very important that the elements of the change package in policy formulation  come together in an integrated and coherent whole?

Laugh. In my own opinion, expansionary monetary and fiscal policies that support growth can lead to an increase in labour demand. For example, taxation policies can be designed or targeted to provide incentives for job creation or labour force participation. And progressive tax policies can also reduce inequality, which has been shown to be a drag on growth.

In my view, Government decision would in the short run favour growth models by focusing on the potential for infrastructure investment to strengthen the link between growth and quality job creation, in the short, medium and long term. This investment also has relatively high multiplier effects.

With extraordinarily low current interest rates, financing for such investments is highly attractive.


Are you saying addressing the deficits in demand would pave way for the growth of the economy?

There is a growing body of research in the country which shows that inequality weakens growth. I am of the view that Nigeria’s specific, comprehensive and multifaceted approach is required that addresses deficits in demand, starting at the level of household consumption and investment.

It’s important to note that good Federal Government policies have important positive spillover effects to other countries and beyond, by increasing aggregate demand, offsetting the impact of negative shocks and reducing the temptation to engage in beggar-thy-neighbour policies, especially now that IMF is calling for the devaluation of the Naira for the nation’s economy to survive the current economic crisis.

And as I said earlier, it is important to address these current economic challenges in integrated and coherent ways through fiscal policies, which have a major role to play in stimulating growth, have been shown to work better in other countries that are less unequal than Nigeria. So addressing inequality, improving tax policies, investing in infrastructure; these are all important elements of coherent, integrated packages to boost overall growth and job creation.

I still maintain that economic and employment growth is mutually dependent and they tend to be mutually reinforcing in either positive or negative directions producing virtuous or, if not counteracted, vicious circles.


What advice, then do you have for the government on the challenges of economic development?

The challenge of national development is for the government to manage the economy in such a way as to promote job-led growth rather than the present situation of jobless growth.

The government should decentralise the economy for genuine development to take place rather than concentrating on the crude petroleum sector, which continues to be an enclave.

I strongly believe that in order to promote development and growth, there is need for government to go into partnerships with the private sector on selective basis until such a time that the domestic private sector becomes fully developed.

This is because our rate of unemployment is one of the highest in sub-Saharan Africa and this is a grouping where you have countries like Somalia, Chad, Niger et cetera yet, we have never been so blessed in terms of revenue from oil wealth at this rate in history. This, we believe is a paradox and must be quickly addressed.

We speak of job driven economic growth. Nigerian workers and its people want to feel the impact of all the growth reeled out periodically by relevant governmental agencies. Nigerians want to see it translated into more qualitative and quantitative food on the table; better education; better social and physical infrastructure; they want to work in decent environment and they want their efforts towards nation building to be adequately recognised and rewarded.

Nigeria is today, for instance, one of ILO’s model country for the decent work country programme and advanced work has been done concerning its actualisation. The findings have been that of huge deficits in decent work targets.

We therefore call for concerted action from Mr. President to address the various identified gaps with a view to making the Nigerian worker the key element in all our employment policies.