The increasing spate of job losses in the banking industry is worrisome not just for its depiction of stress in that critical sector but also for its overall telling effects on the country’s struggling economy.
It is hardly surprising that the state of human capital retention in the sector has come under intense focus in recent times.
Though this is not unique to the banking sector, the general interface of the generality of the population with the banking industry makes the undesirable situation of job losses in the sector quite obvious and lamentable.
Since early last year when the COVID-19 pandemic started having its toll on the Nigerian economy with many banks suffering under the lockdown imposed by both the federal and state governments across the federation, many of the bank branches have been shut and/or opened at intervals with staff, particularly at the junior levels at the receiving end in the bargain.
Indeed, the lockdown had significant effects on the economy. The deposit money banks, by virtue of their profit orientation, have understandably found it difficult to retain the same complement of staff as in normal times and have had to rationalise a good number of their staff with many of the casualties being the young and new entrants into the industry who have suddenly found themselves joining the ever-growing army of the unemployed in the country. Many of those affected are casual workers, contract staff, and those performing other support services in the industry. This perennial human capital crisis in the banking sector actually grew worse in the year 2020.
Recent statistics from the National Bureau of Statistics revealed that about 44,664 contract staff on the payroll of commercial banks have been reduced by over 5,000 as well as over 2,000 junior staff losing their jobs, among others. From the report, almost 8,000 job losses have taken place in the sector in the first nine months of 2020 with serious implications for the many hurting families across the length and breadth of the country. Something needs to be done about this sorry situation of job losses in this sector that has provided succour for many young graduates from the country’s institutions of higher learning. A lot of matters arising from this development.
First, the Central Bank of Nigeria (CBN), as the regulator of the sector needs to intervene in enhancing job retention in that sector. In as much as the banks are structured to make profits for their shareholders, they should be made to understand that in cases of national emergency, an enhanced measure of corporate social responsibility would be required of them in addressing a national challenge. Hence, the Central Bank would need to intervene to stop any frivolous staff turnover in the banks.
In as much as the CBN had recently “made it clear that no bank must sack” its staff by virtue of the COVID-19 pandemic, it must “walk the talk” and ensure that overzealous chief executives of the banks do not breach the guideline in a bid to beef up their profitability over this period. Yes, it is obvious that no bank has operated at full capacity since the lockdown was lifted and that rationing of employees across work shifts and functions exist, yet financial transactions have not significantly diminished as the average customers have largely resorted to the use of the digital platform in carrying out their various transactions.
So, the loss of income to banks may not really be significant, and they should thus be in a position to accommodate some marginal decline in profitability, to assist in finding a solution to a national emergency. If the rate of staff retrenchments is allowed to go on unhindered, the implications for the growing level of poverty and insecurity in the country would be overwhelming. Given that the country is yet to fully contend with the growing menace of the Fulani herdsmen across farmlands nationwide and the unemployment they create among farmers, the country cannot afford to add more “salt to injury” if the staff bleeding in the banking industry is left to worsen.
Ironically, the staff unions in the industry may have little they can do in this regard given that many of the new generation banks are not unionised. Nevertheless, the National Union of Banks, Insurance and Financial Institutions Employees (NUBIFIE) and the Nigeria Labour Congress could still engage the banks and ensure that they are humane in their treatment of issues that concern their staff regarding job retention, avoidance of unnecessary pay cuts and general staff welfare. The Nigerian economy is going through some tough times. All hands should be on deck to assist the ordinary Nigerians to keep their jobs in both the public and private sectors.
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