Contract staff across Nigerian banks hit a record 46,263 in June 2019. This is revealed in the latest banking sector report released by the National Bureau of Statistics (NBS).
According to the Bureau’s report, contract staff in banks rose by 6% from 43,955 in June 2018 to 46,263 in June 2019. This means in the last one year, contract staff rose by 2,308 across all banks.
The Breakdown: According to the NBS report, staff in Nigerian banks are categorized into the executive staff, senior staff, junior and contract Staff. There has been an upsurge in the bank staff strength in the last five years and it is rising by double digits.
- In the last three years, banks staff in Nigeria rose from 77,096 in 2017 to 104,364 in 2019.
- Meanwhile, the breakdown shows that contract staff employment has surged more than any other staff category.
- For instance in Q1 2017, Nigerian banks had a total of 77,096 staff, out of which Junior staff was the highest with 36,202 staff (47%), Senior Staff (20,483 staff or 27%), Contract staff (20,237 or 26%) and the executive staff with 174 or less than 1%.
- Meanwhile, three years later, Contract staff in Nigerian banks rose significantly.
- As of June 2019, Contract staff recorded the highest number with 46,263 staff or 44.3% of the total staff across Nigerian banks.
- Others include junior staff (39,980 or 38.3%), Senior Staff (17,943 or 17.19%) and Executive Staff (178 or 0.17%).
Drop in Bank Staff: Further analysis shows that Bank staff dropped from 105,017 in March to 104,364 in June 2019. This means bank staff dropped by 653, and this may be traceable to retirements, resignation and possible restructuring exercises.
- A closer look shows that the biggest drop was recorded in the senior staff category, followed by junior and the executive staff.
- It is also instructive to note that despite the drop across all categories, contract staff still recorded a slight rise. In June 2019, only contract staff categories recorded an increase while others dropped.
Number Explained: This implies that Nigerian banks are increasingly depending on contract staff to perform daily operations. Just as earlier stated, contract staff rose by 128.6% between 2017 and 2019. This point to the fact that banks are changing their recruitment policy to favour more of contract employees who are predominantly young graduates.
- Experts have opined that it costs banks less to employ contract casual staff while the process of retrenching them is also easy, therefore, contract staffing has become a preferred recruitment option for banks.
- Also, the evolution of technology has been noted to have contributed to the rising trend. Specifically, industry experts have argued that the increasing aid of computer programmes and applications, have made bank jobs turn very routine and requiring less skill.
- Hence, since semi-skilled jobs often attract low wages, banks see this as an area of cost savings.
The Bottom line: While contract staff recruitment trends have both positive and negative sides, the improvement in technology across banking operations will lead to surge in the pool of contract staff. While banks benefit due to improved profitability, there are other critical downsides to the economy.
- First, it should be noted the financial sector only constitutes 1.3% of Nigeria’s total employed population. Meanwhile, a further look shows sector constitutes a large percentage of the underemployed population in Nigeria.
- This brings us to the fact that as more fresh Nigerian graduates face a bleak future, especially those seeking a future in banking, an average graduate will need to be exceptionally good to get a non-contract job in the banking sector.
- This also has negative consequences on youth migration out of Nigerian. Hundreds of thousands of Nigerians are seeking a better life in countries like Canada and the United States as quality jobs become fewer.
- As rightly noted that the youthful population of Nigeria forms its biggest strength to economic prosperity, this means as more Nigerian graduates seek greener pasture in other countries, this may constitute future brain drain in the economy.