Beyond the tragic health hazards and human consequences of the COVID-19 pandemic, the economic uncertainties and disruptions that have resulted come at a significant cost to the economy.
For most developing economies, the odds of sliding into a downturn are gradually expected as the global coronavirus outbreak puts severe pressure on the economy.
It is worthy to recall that Nigeria is still sluggishly grappling with recovery from the 2016 economic recession which was a fall out of the global oil price crash and insufficient foreign exchange earnings to meet imports.
The 2016 recession saw a variety of measures by various institutions to remodel their businesses and that led to a significant number of job losses across sectors.
The banking sector was on the forefront of these job cuts as the country gradually began to see a shift from the traditional bricks and mortar branches to digitally-powered service outlets.
The digital transition has continued to see a decrease in banks’ manpower. In the third quarter of 2019, data released by the Nigerian Bureau of Statistics revealed that Deposit Money Banks (DMBs) in Nigeria cut the number of their staff by 2,929 in three months.
This indicated a 2.8 per cent decrease in staff strength within the three months as the total number of the banks’ workforce stood at 101,435 in Q3 compared to the 104,364 recorded in Q2.
Year-on-year, the banks’ staff strength has reduced by 1,386, representing a 1.3 per cent decline when compared to the 102,821 staff recorded in the same period in 2018.
While the NBS did not indicate whether the staff strength was cut through retirement or retrenchment and from which of the banks, recent reports suggest that the banks are under pressure to lay off more staff as the economic realities bite harder.
The biggest indicator for the implication of the current realities on jobs in the sector was made known in a video that has now gone viral on social media, where Herbert Wigwe, the chief executive officer of Access Bank, said: “Everybody may have to make some adjustments of some sort. We probably don’t need as many security men as required, even to the fact that we are not going to have all our branches open between now and December.
“We certainly don’t need all the security men. We don’t need all the tea girls. We don’t all the cleaners. We don’t need all the tellers, et cetera, et cetera.
“So that number of staff which represent 75% of our staff strength, I think, is the one we basically need to speak with their employers with a view to getting them to rationalize to the level that we think will be necessary to basically sustain a mean but actually a customer service-oriented institution.”
Wigwe said discussions were already ongoing with recruiting agencies and contracting firms on how to cut back on the workforce.
“The second has to do with our professional cost. Now that one is very tricky and it is tricky because I do understand and appreciate that it is going to bring its own pain to staff. We basically have to make the adjustment the same way it sounded when we spoke ten days ago with respect to basically cutting down cost
“I would be the first to take the hit and I’m going to take the largest pay cut, which would be as much as forty per cent (40%).The rest, we shall have to cascade right through the institution.”
Assuring that the bank would revert to what is normal when things improve, Wigwe said the adjustments were necessary to survive the difficult times.
“What is important is that these adjustments are what is required at a time when we see Armageddon, when we see great difficulty coming in, to make sure that if there is one institution left standing in this country as a bank, it must be Access Bank,” he said.
“We appreciate the fact that it is going to hurt people but we necessarily have to take that adjustment to ensure that we protect our franchise and make us stronger as we move into the future.”
A member of staff of Access Bank who spoke to Daily Trust on condition of anonymity said: “We were only informed on Wednesday that we would take a pay cut and that has dampened the spirit of most staff but it is better than sack.
“They told us that we are currently living in an uncertain time and the bank is challenged on many fronts having only recently acquired another bank and managing the risks acquired.”
Analysts have argued that since Access Bank with its financial strength has toed this line, it is only a matter of time before other less endowed banks follow.
Similarly, some aviation companies have also announced salary cuts in response to the COVID-19 pandemic that has grounded activities.
Although, sector-specific implications and impacts vary, the impact on the aviation sector is a result of the implications of the pandemic on local and global travel.
With the suspension of flights by Nigerian airlines over one month ago, all the carriers have lost 100 per cent of their revenue, leaving them bleeding and crying for help in fulfilling obligations to aircraft lessors, fuel suppliers, caterers and above all emoluments to workers.
At the outset of COVID-19 outbreak in Nigeria when airlines joined the efforts to contain the spread by shutting down operations, the National Union of Air Transport Employees (NUATE) had raised fears of impending job losses by airlines.
No sooner than the suspension of flights took effect that Max Air, one of the domestic airlines, issued a memo to its staff, saying it would not be able to continue with salary payments, leaving the workers in bewilderment.
But Max Air would not be the only airline to implement tough and stringent measures for workers as a result of the COVID-19 induced shutdown.
Arik Air, one of the major airlines in the country also implemented 80% pay cut for all members of staff of the company in April and as from May 1, 90 per cent of the workers have been asked to proceed on leave without pay.
It was learnt that other airlines also implemented pay cuts ranging from 30 per cent to 60 per cent in the month of April while there are fears that airline workers may not get any pay this month.
Unions in the industry are however angry over the arbitrary pay cuts and redundancy declaration by employers in the industry, stressing the need for engagement with the unions before any decision is taken as it affects their members.
Aviation unions specifically rejected the decision by Arik Air management to implement 80% pay cut. The unions comprising the Air Transport Services Senior Staff Association of Nigeria (ATSSSAN), National Union of Air Transport Employees (NUATE) and the National Union of Aircraft Pilots and Engineers (NAAPE) in a letter to the managing director of Arik Air said the cut in April salaries was unacceptable.
They however said any percentage paid to the members would be considered as part payment of monthly emoluments pending when an agreement was reached with the unions.
A former General Secretary of NUATE, Comrade Olayinka Abioye in a chat with Daily Trust called for proper understanding, cooperation and social dialogue in resolving the issue at hand.
All employers of labour, he said, should engage the unions/workers representatives in discussions on the way forward.
“You may be surprised that these same employers will be asking government to provide palliatives even after they have failed to pay staff, retrenched them or deprived them of benefits mutually agreed in their collective bargaining agreement or conditions of service,” he added.
President of ATSSSAN, Comrade Illitrus Ahmadu, noted that aviation unions recognizing the impact of COVID-19 on aviation businesses wrote to the federal government to provide bailout for the airlines.
He however said the workers should not have been made to suffer.
He said: “While we are using this day to empathise with every player in our industry, including our toiling comrades who have been in one way or the other traumatised by the consequences of COVID-19 pandemic, may we quickly express that we are not unaware of the various regrettable assaults some employers are ignorantly directing against the innocent workers in their employment.
“While we genuinely remain accessible to every willing employer for constructive engagement to mutually address the negative impact of COVID-19 towards finding a win-win solution out of this present situation, we shall not accept this regime of unilateral and arbitrary cutting of our members’ salaries and declaration of unpaid leaves. We are prepared to confront these assaults upon resumption with every vigour in us. This is not an empty threat!
“Comrades, it is also important to inform you that in understanding and appreciating the enormous dangers the COVID-19 disruption poses to the survival of the aviation sector, our union, in conjunction with NUATE, NAAPE and ANAP quickly forwarded a passionate letter of appeal to the federal government for special intervention in the aviation industry, of which all business operators shall be the greatest beneficiaries. Though, without prejudice to what the various aviation businesses are passing through at this time, we sincerely see no reason why our members should be a target for victimisation, especially at this early period of the crisis.”
