Following the recent agreement between the Federal Government and organized labor on a new minimum wage of N70,000, the Organised Private Sector of Nigeria (OPSN) has raised concerns about its capacity to meet this financial obligation.

The workers’ union had initially accepted the increase based on President Tinubu’s assurance of government support to facilitate the transition for private sector employers.

The OPSN is now urging the Federal Government to promptly outline the specifics of the promised support to enable businesses to plan effectively. The private sector is currently grappling with substantial production costs and other financial pressures.

Mr. Adewale-Smatt Oyerinde, Director-General of the Nigeria Employers’ Consultative Association (NECA), voiced these concerns on behalf of the OPSN.

While acknowledging the government’s efforts in approving the new minimum wage, he emphasized the need for additional measures to alleviate the burden on businesses.

These measures include reversing recent increases in electricity tariffs, ensuring that the Central Bank of Nigeria (CBN) fulfills outstanding financial commitments to companies in the productive sector, imposing a moratorium on new taxes and levies for the next five years, and providing exemptions and subsidies for imported conversion kits.

Oyerinde stressed the importance of implementing reforms that will enhance the private sector’s capacity to absorb the new wage levels.

He noted that during discussions with the National Minimum Wage Committee, the OPSN had previously expressed concerns about meeting the earlier recommended minimum wage of N62,000.

This recommendation was made with the understanding that the government would take concrete steps to mitigate the existing economic challenges facing the private sector.

The NECA Director-General underscored that the ability of the private sector to comply with the new wage demands is a critical issue that needs addressing.