Job cuts displace workers as COVID-19 hits employers | Dailytrust

Job cuts displace workers as COVID-19 hits employers

FILE: Cross section of applicants during a recruitment exercise in Abuja in 2018.
FILE: Cross section of applicants during a recruitment exercise in Abuja in 2018.

Employers in different sectors of the economy have disengaged workers to mitigate the negative effect of coronavirus pandemic on their ventures.

Daily Trust’s findings show that most sectors of the economy are affected apart from those driven by technology.

However, at least N107.45 billion has been accessed by beneficiaries from the N1.15 trillion Central Bank of Nigeria’s (CBN’s) COVID-19 pandemic intervention funds within the last 90 days, data by the apex bank has indicated.

The data showed that close to 6,000 beneficiaries, comprising organisations and individuals, had accessed the loans so far.

Reports from across the country revealed that workers have been disengaged from aviation, hospitality, banking, construction, manufacturing, media and sales and services sectors.

The National Bureau of Statistics (NBS) reported over the weekend that 42 percent of Nigerian workers lost their jobs as a result of the impact of COVID-19, diminishing incomes of 79 percent of households in Nigeria.

“The impact on employment and income has also been widespread. The impact of COVID-19 has been most strongly felt in the commerce, service and agriculture sectors,” NBS explained.

50,000 jobs cut in MSME sector

The Micro Small and Medium Enterprises (MSMEs) operators are among the worst hit by the effect of the COVID-19 pandemic as some of them closed shops and their employees automatically lost their jobs.

The National Vice President, North Central of the National Association of Small and Medium Enterprises, (NASME), Engineer Auwal Bununu Ibrahim projected that about 50,000 workers have been disengaged in the MSMEs sub-sector of the economy.

Ibrahim said over 10,000 MSMEs businesses have collapsed across the country.

Director General of Lagos Chamber of Commerce and Industry (LCCI), Dr. Muda Yusuf, said employers have very little capacity to absorb the shocks inflicted by the COVID- 19.

“Their cash flow had since collapsed; most of them depend on daily income streams for survival and they cannot sustain their workforce when their income streams have collapsed,” he said.

He said worst hit are businesses in catering, rental, decoration, event planning and musicals among others.

Data from NBS show Nigeria has about 47 million MSMEs in the country.

An expert and Senior Economist with SPM Professionals, Mr. Paul Alaje, projected that “unemployment figures may reach 40 percent record high by Q4 2020.”

Hotel workers at home without pay

Many hotels have disengaged staff in the wake of the coronavirus pandemic.

Several support staff have been asked to stay at home without pay pending when businesses pick up.

A staff of a top hotel in Abuja, Moses Sule, said he has been waiting to be recalled since the management asked most staff to stay away from work without pay.

Sule said it has been a harrowing experience for him and his colleagues.

Media cut employees

The COVID-19 pandemic took toll on media outlets in Nigeria leading to disengagements and early retirement of some staff.

Findings show that newspaper and radio firms were the most affected with at least three media organisations that retrenched workers or converted them to freelance staff while many others had slashed workers’ salaries as a way to cut cost.

The chairman of the Nigerian Union of Journalists (NUJ), Abuja Chapter, Emmanuel Ogbeche, told our correspondent that the number of media practitioners that are losing their jobs is increasing. Ogbeche urged media organisations not to put profit above media ethics and professionalism.

“Some of the hands that are being retrenched are experienced hands and the media industry needs them to groom new hands,” he said.

Uncertainty grips staff at ports

Nigerian ports may suffer job cuts any moment from now as a result of low cargo imports.

The National Council of Managing Directors of Licensed Customs Agents (NCMDLCA) has warned Nigerians to expect a low turn-around of cargoes into different ports starting from June 2020, due to the COVID-19 pandemic.

The Deputy National President of the Council, Adeniyi Ajayi said “Clearing Agents might not be able to get jobs as a result of low cargo trade. As a clearing agent, what will be the need to have ten to 15 workers amidst job scarcity?” he asked.

The President of Association of Nigerian Licensed Clearing Agents (ANLCA), Tony Iju, said the maritime sector had recorded job losses.

He said shipping companies have laid-off workers while freight forwarders asked their boys to stay back.

Bank workers lucky

However, the President of the Association of Senior Staff of Banks, Insurance and Financial Institutions (ASSBIFI), Comrade Oyinkan Olasanoye, told Daily Trust that at present, commercial banks have heeded the call by the Central Bank not to sack their workers.

Olasanoye, however, said there were complaints from members that some of the deposit money banks were at the verge of reducing salaries and reviewing contracts saying, “This is an indirect way of asking people to take a walk.”

Insurance firms cut jobs

Daily Trust findings show that private sector industry players in the insurance sector recorded a few job losses.

“Cumulatively, I haven’t heard up to ten jobs loses so far in different companies, so it is not that significant to worry about,” a staff of one of the tier one insurance company’s told our correspondent.

The spokesman for the Nigerian Insurers Association (NIA), Mr. Davis Iyasere said the association has not received news of sacking in the insurance companies.

Also, the spokesman for the Nigerian Council for Registered Insurance Brokers (NCRIB), Mr. Dele Ayeleso, told one of our correspondents that the council hasn’t “heard of any insurance broking firm sacking any workers.” The regulator, National Insurance Commission (NAICOM) also said it has not received any information of sacking of staff due to COVID-19 in the insurance sector.

The Head, Commissioner for Insurance Directorate of the NAICOM, Mr. Rasaq Salami, said he is not aware of retrenchment in the industry.

Our correspondent reports that job losses in insurance sector and other financial services sector will come in the course of implementing new business models that the COVID-19 pandemic has thrown up.

PwC in its assessment of the industry noted that “as the number of enquiries and claims increase, insurers need a cost-effective going forward.

“Directing customers to self-service channels and the automated processing of straightforward claims are proving effective,” PwC said.

 School adopts pay-per-hour solution

Job losses in the education sector will only come to the fore when schools resume, particular among private schools.

Daily Trust’s findings show that some private schools have stopped paying salaries.

“I don’t know if they will pay us since we did not work but they asked us to do some lessons via video for the pupils,” a school in Abuja said. The chairman of a faith based private school in Abuja, who doesn’t want to be named, said they have no plan to sack any teacher.

He said they paid their teachers 50 percent of April and May salaries, but that from June 2020, they will be paying N500 per hour to teachers.

Fear heightens in power sector

Some employees in the power sector told Daily Trust that there is no immediate loss of jobs yet but they feared that the post COVID-19 era and looming recession may have a negative impact on the sector.

Mr. Mike Olokun, an electrical engineer with a Generation Company (GenCo), said the Nigerian Electricity Regulatory Commission (NERC) had issued a business continuity order spelling out what the power firms should do immediately the lockdown of COVID-19 began, to avert any job loss or crumbling services.

Moses Saidu, an employee of one of the GenCos, said: “Although, we at Kaduna Electricity Distribution Company haven’t had any abnormal cases of job cuts, we fear there would be no promotion this year along with some other allowances due to revenue losses.”

The power sector had recorded over N1 trillion shortfall so far, a development that is reportedly affecting power supply services. There was to be some respite with a semi cost-reflective tariff planned to kick-in in April 2020 before the COVID-19 pandemic struck and NERC postponed it till June ending. Daily Trust reports that the 11 DisCos lost N366 billion in the last three months.

John Damilare, a meter installer under a Meter Assets Provider (MAP) in Abuja, shared his experience: “Most of the installers have not done any work since April and we are not on salary. The MAP firms contracted us on a ‘pay-per-installation’ model, which means one is not paid if no meter installation takes place.”

The President, Nigeria Consumer Protection Network (NCPN), Kunle Kola Olubiyo, said to forestall job losses in the power sector, the federal government should immediately give fiscal incentives like rescheduling of loans for the operators and bring in subsidies.

The Managing Director of Benin DisCo, Mrs. Funke Osibodu, on a recent PWC webinar on COVID-19 and the power sector urged the three tiers of government to pay all outstanding bills to improve market liquidity.

No jitters in telecom, oil & gas sectors

Telecom, information and communications technology as well as oil and gas sectors of the economy did not feel much impact of the coronavirus pandemic as no job loss was recorded.

Daily Trust’s findings revealed that many private businesses in these sectors thrived during heat of the pandemic even as most of their workers operated from home. One of the MTN Nigeria staff who spoke with one of our reporters said he wasn’t aware of any job loss in the telecom company.

“MTN didn’t sack anyone because of coronavirus. We have all been working from home and I think the company made a lot of money. So, I am not aware of any job loss,” the MTN staff who begged for anonymity because he was not authorised to talk the media, said.

However, a telecom right advocate, Chief Deolu Ogunbanjo, said companies should embrace disruptive innovation as a means to thrive and generate future income even as the world struggles with the COVID-19 global pandemic.

The Director General of the National Information Technology Development Agency (NITDA), Mallam Kashifu Inuwa Abdullahi has predicted a paradigm shift in workforce post-COVID-19.

Abdullahi said “things are not going to be the same after the pandemic and the world economic order is going to change.”

In terms of jobs, Abdullahi said tech start-ups still have future in the country. Mallam Abdullahi enjoined the start-ups to have a mind-set of creating businesses for themselves rather than creating jobs to ensure continuity in case of their absence while the companies are still active.

 NLC fumes

The President of the Nigeria Labour Congress (NLC), Comrade Ayuba Wabba, said labour foresaw massive job losses and requested government’s intervention. He said one of the greatest threats to the stability of Nigeria as a country is the issue of unemployment. The NLC boss urged companies to use part of their profits to make sure that workers are not disengaged anymore in a period the country is in economic crisis.

“They should be able to put in part of what they counted as profit in the past years to serve as mitigating measure to protect those jobs,” he pleaded.

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