42% of Bank employees now contract staff as fresh graduates settle for less


Data from the National Bureau of Statistics shows Nigerian banks are relying more on contract staff to boost operations.

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The recently published data on Sectorial Breakdown of Credit, ePayment Channels and Staff Strength (Q2 2018) shows the banking sector employed a total of 43,955
contract staff as employees. This compares to about 21,837 a year earlier and a 101% increase YOY.

Bua group

Some key metrics

  • Total banking sector employees as at 2018 Q2, 101, 861 compared to 89, 608 in the previous quarter. Total banking sector employees were about 77,096 in the first quarter of 2017 and 75, 607 in the second quarter of 2017.
  • Total employees in the banking sector have now risen by 13.67% quarter on quarter and 34.72% year on year.
  • Contract staff as a percentage of total employees has risen from 26% at the start of 2017 to about 43.2% in 2018. Contract staffs are now on track to surpass the 50% mark in the next few months.
  • Before now Junior staff’s made up a larger percentage of banking staff. However, in the second quarter of 2018, contract staff jumped from 32,013 in Q1 of 2018 to 43,955 in Q2 of 2018, indicating that banks employed a whopping 11,942 contract staff in the second quarter alone.
  • Junior staff remain at just over 40k.

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Why is this important?

  • As banks struggle to reign in on high cost to income ratios, the increasing reliance on contract staff is expected to help reduce overheads especially as it relates to personnel cost.
  • The data confirms banks are now relying more on contract staff to handle routine operational activities while it leaves core banking activities such as trading, treasury, loan making to permanent employees.
  • Banks that have a higher percentage of contract staff to total staff will likely save more on overheads and can pass these cost savings to shareholders. However, this depends on whether some of the so-called cost savings are being shifted towards executive and senior staff compensation.
  • In terms of employment opportunities for Nigerian Youth, this suggests the days of getting a bank job straight out of school is diminishing. Except for specialized Graduate Management Trainee programs, most fresh graduates will likely be employed as contract staff.
  • We also understand a number of newer outsourcing companies are also springing up to provide contract services for the banking industry. Most utility companies in the telecoms and power sector already rely on contract staff for their operations.

Any downsides

  • For the banking sector, incessant cases of fraud are being linked to contract staff.
  • In a recent fraud which occurred in tier 2 commercial bank, a staff of the bank informs Nairametrics that some of the contract staff are exposed to core operations of the banks such as cash and cheque handling and also have access to delicate customer information that makes the bank vulnerable to fraudulent activities.
  • Because of their limited contractual obligations, contract staff easily abscond with little or no recourse to guarantors.


  1. The regulatory authorities should force the banks to stop these contract of a thing, is not really fare in so many quarters, the Major work is done with them, at the end of the day they are paid nothing but change,pee nut. CBN should please put a restrictions on this contract of a thing. Banks keep on declaring huge profits all the time, but the customer front line labourers (contract staff) are left with nothing without conversion for years.

  2. Employing contract staff is not the way to reduce overheads.
    Have you considered what the overhead of just one senior or executive officer is in the banks?

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