After weeks of avoiding banking halls like a plague, I ventured into one to perform a transaction last week. As I walked in, I felt eerie, as if I was going into an unfriendly territory. My experience in the weeks leading to and after the presidential election on February 25, and I guess, for most Nigerians, had been traumatising. I had decided that for my sanity, I should source for cash from any other source than go to a bank or an ATM.
So, I went into the banking hall with foreboding, this past week. I watched to see whether the cruel experience in February and March had given way to the conviviality of the old banking halls. But no, the customers were unsmiling and nervy, as no one was getting cash across the counter. I asked, and was told that cash comes intermittently into the vaults, and before you can say jack, the money is completely exhausted. On my day, there was no cash to pay out.
I teased the cashier whether she could help me, and she said, “sorry sir, we don’t have cash.” I asked even a little of it, and she said, not at all sir. I retorted, is it not strange that the bank, the repository of cash has become cashless? My observation tickled her, and those overhearing our little conversation. I wondered in my mind whether she would still be working in the bank, a few years, if not a few months from when we interacted.
While I do not wish her ill, I have been wondering how a banking hall could be populated by staff who have no work to do? Unless I am belabouring in ignorance, I believe handling cash is the major work of the bank workers, at least the ones that usually interact with customers. I recall that many of the new generation banks had to employ what they dubiously called temporary staff to handle the cash transaction that came with the expansion in Nigeria’s banking halls, in the past few decades.
That was the modernising era, when aesthetics and computers were introduced, and bank workers started dressing in designer clothing. Before then, bank workers usually looked scruffy, and the males with their bold long ties. The banking halls were also very unfriendly, and hibernated by unfriendly customers who spent long hours as workers pored through ledgers, adding and subtracting to get the actual balance for the day’s transaction. But all that modernised with the emergence of super bank workers turned owners, like Tony Elumelu and Jim Ovia.
Now that Godwin Emefiele has forced a contraction in cash transactions, especially in the banking halls, there is the likelihood of job losses in the banks. Indeed, I understand that at the height of the cash squeeze, which affected the workers as much as the public, bank workers were rationing their working days. Instead of five working days, some were doing two or three, and of course with no transactions in the banking hall, the public didn’t take notice of the change.
One of the banks I visited was operating three out of five working days because, as they claimed, their workers didn’t have the cash to pay for transport to come to work daily. While this staff rationalisation was going on, I doubt if the staff knew that they were declaring themselves partially redundant. Of course, in labour law, redundancy is a veritable ground to reduce the workforce, as the employer is not expected to pay when there is no work to be done.
I don’t know whether Emefiele also had motives to cause job losses in the banks, as part of his one-in-all cure for all macro and micro economic problems he could not solve in the more than eight years he has been the governor of the Central Bank. Last week, the KPMG predicted that the unemployment rate will hit 40.6 percent in 2023, while the Nigeria Economic Summit Group (NESG) projected the rate at 37 percent. Perhaps a break-down would reveal how many bankers would join the unenviable unemployment market.
There is the necessity to determine how many Nigerians lost their jobs and businesses as a result of the currency swap and cash crunch enforced ruthlessly by Emefiele and his fellow illiterates in political economics. Those who say that economics is too important to be left in the hands of economists surely know what they are saying. While Emefiele was allegedly seeking to ensure that politicians and kidnappers have no access to cash, law-abiding citizens and businesses paid an even higher price than the targets.
The ‘KPMG Global Economy Outlook report H1 2023’ portrays Emefiele and the presidential economic team as a complete disaster. It said: “Unemployment is expected to continue to be a major challenge in 2023 due to the limited investment by the private sector, low industrialisation and slower than required economic growth and consequently the inability of the economy to absorb the 4-5 million new entrants into the Nigerian job market every year. Although the National Bureau of Statistics recorded an increase in the national unemployment rate from 23.1 per cent in 2018 to 33.3 per cent in 2020. We estimate that this rate has increased to 37.7 per cent in 2022 and will rise further to 40.6 per cent in 2023.”
Of course, it would be unfair to excoriate the President Muhammadu Buhari administration without a corresponding indictment of the sub-national governments. They are all members of the ignominious era that turned Nigeria into a sea of unemployed heads. But since June 2014, when Emefiele was appointed governor of CBN, the unemployment rate has increasingly gotten worse. From an average of about 13.3 per cent it was increasing marginally, but from about the third quarter of 2017 the unemployment rate has been galloping, to get us to where we are now.
While the 2019/2020 COVID 19 era may have contributed to tripling unemployment rate, no doubt, Emefiele’s poor grasp of macroeconomic indicators, as manifested in the draconic currency swap and cash crunch, underscores how and why we are in an economic quagmire on his watch. Imagine banking workers unable to go to work because they have no cash to pay for transport. And when they get to work, even though customers are milling around, they are pinging away the day.
Luckily, Asiwaju Bola Ahmed Tinubu, the president-elect, is believed to be knowledgeable in economic theories and management. So, he is expected to work economic miracles to return Nigeria to the path of economic growth. As the KPMG report shows, the prognostication for 2024 is even scarier than the current unemployment rate. It is predicted that the unemployment rate will grow to 43 per cent while inflation will inflate to 20.3 per cent in 2023 and 20.0 per cent in 2024.