HomeBUSINESSStrike Actions May Lead To Loss of N50 Billion Daily, Expert Warns

Strike Actions May Lead To Loss of N50 Billion Daily, Expert Warns

Experts in key sectors of the economy warn that the nation may be losing N50 billion daily if the Labour embarks on strike on Tuesday. 

They were undisputed on the plight of Nigerians but warned that the strike action at this time would further affect the economy. 

It was stated that apart from the economic problems, the industrial action would create fear and send wrong signals to foreign investors. 

They said if the strike finally takes place, the economy of the nation will be affected by losing revenue. 

Dr Femi Egbesola, the President of the Association of Small Business Owners of Nigeria(ASBON), said this action would make investors lose confidence in the economy and lose all funding opportunities for Small and Medium Enterprises and SMEs. 

He added that concerning the previous assumptions from the Nigeria Bureau of Statistics (NBS) the strike action may lead to a daily loss of N50 billion to the economy. 

Egbesola stated: ” Anytime there is a strike in Nigeria businesses are shut down, government offices are closed and work is brought to a total halt. It makes the country standstill, as workers stay at home and businesses lose money. 

The overall effect of strikes hinders the growth of the national economy. Business owners will find it difficult to meet their financial obligations like loan repayments and prompt delivery of goods and services to clients. Hence, bad loans and customer dissatisfaction are accumulated. Investors lose confidence in the economy and hinder funding opportunities for SMEs.

In the final analysis, our inflation rates increase drastically, forex becomes scarce, the cost of living increases, more jobs are lost, vices and crimes keep trending, poverty flies higher and the masses lose their trust in government and governance. 

Sometimes, many people lose their lives due to violence and accidents during the protests and more importantly due to the closure of public hospitals and medical practitioners. 

According to the former assumption of the Nigeria Bureau of Statistics (NBS) on previous strikes, the estimated loss of N50 billion may be daily recorded. 

These estimations don’t contain secondary-level costs like employment opportunities lost and more. 

Concerning this, Clifford Egbomeade, Business Analyst and Communications expert at ID Africa expressed his fear that strikes will disrupt economic activities by making businesses temporarily standstill or operate in a limited capacity due to employee absenteeism. 

Major sectors such as manufacturing, transportation, and services may experience interruptions, leading to decreased productivity and economic output. For a country like Nigeria, where businesses have already grasped economic challenges, this action will worsen the hardship of the country.

The action, if undertaken, can dent investors’ confidence, potentially leading to a slowdown in Foreign Direct Investment (FDI). 

However, a frontline economist and CEO of Economist Associate (EA), Dr Ayo Teriba argued that the proposed action could be positive for the nation. 

He said, “Any discussion on the possible effect of the strike on Nigeria now will be speculative.” He continues, “I don’t think the labour going to strike will destroy the economy. They are doing this to press home demands for the betterment of the workforce.  

If the strike eventually happens it will succeed in getting the government to enhance the condition of the workforce and will be a positive for the economy. 

In a nutshell, this industrial action may not hold, if it holds, it may not be effective and if it’s effective, it will be positive. It may be positive for the economy.” 

Also, Sola Oni, the Chartered Stockbroker and CEO of Sofunix Investment and Communications commented that labour unrest is one of how workers demand favourable terms and conditions of employment. 

Collective bargaining always ends in a strike when labour demand looks impossible for the government to act on. The strike comes with a cost to the economy. It can lead to the breakdown of law and order when it has been hijacked by hoodlums. 

Moreover, Economic and investment Strategist, Akinloye Ayorinde expressed caution on the effect of the impending strike, saying it depends on the level of compliance by the labour unions and affiliated members. 

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