Abuja – An Economist, Prof. Ben Aigbokhan, has called on the Federal Government to review workers’ salary to boost productivity in the country.
Aigbokhan, President of Nigeria Economic Society, made the call in an interview with The Nigerian Observer in Abuja on Sunday.
According to him, upward review of the salary will help to reduce restiveness which is capable of disrupting domestic production.
He also reasoned that upward review of salary might further fuel inflation as employers would attempt to recoup their profit by increasing the cost of goods and services.
“If the cost of living in major cities is taken into account in fixing salaries, disparity may be defensible, but if productivity differential is taken into accounts for the disparity, then government should discourage it.
“This breeds discontent and corrupt practices in workers who consider themselves disadvantaged in the salary structure,’’ he said.
On inflation rate, the lecturer said that the government should increase supply of goods to check rising prices in the face of demand.
Aigbokhan said that government should not raise interest rate to check inflation as this would hurt domestic supply the more as output declines.
“Naira exchange rate depreciation is a factor in rising prices through imported inflation.
“So, government should check further depreciation of the Naira which is currently around N295 to a dollar instead of N280 to a dollar with the new Forex policy.
“It is possible but difficult to bring inflation rate to single digit in the next one year.
“It can be possible if domestic output is significantly raised, Naira slide is halted, and domestic demand is itself significantly discouraged,’’ he said.
The National Bureau of Statistics, the Consumer Price Index, measured inflation increase to 16.5 per cent in June from 15.6 per cent in May.
The Minister of Labour and Employment, Sen. Chris Ngige
