2017: Banks rely heavily on contract staff for employment
By Odunewu Segun
Despite record profits, bank hiring in 2017 showed significant preference towards hiring contract staff, according to data from the National Bureau of Statistics.
At 26, 723 staff, representing a 22.3% increase banks seem to have shifted focus to cheaper manpower.
Based on the data banks now have 197 executive staff, 20,420 Senior Staff, 35,191 Junior Staff and 22, 673 contract staff.
National Daily gathered that increase market share in the retail banking space may have been responsible for why banks rely more on contract staff to market their products.
Significant investment on mobile apps, ATMs and other technological advancements also mean routine banking operations are now handled by lowly skilled workers making it unnecessary to retain staff on permanent contracts, which are significantly more expensive.
The economy however turned the corner in the first quarter of 2017 following a rash of CBN policies that improved investor confidence for the naira. Nigerian banks have since then raked in billions in profits from forex revaluation and transactions, helping them mitigate losses arising from rising non-performing loans.
The year 2017 has also been a remarkable year for Nigerian banks, earning over N400 billion from treasury bills alone, a short-term security instrument sold by the CBN on behalf of the government. With interest rates as high as 17% for most parts of the year, banks have raked in billions in tax-free income further consolidating their dominance in the economic landscape.
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Bank profits for the first 9 months of 2017 currently top N520b billion and is expected to top N600 billion by the end of the year. In terms of Balance sheet size, banks also reported a stronger balance sheet in 2017 compared to 2016.
Balance sheet size of the top banks is at N31.3 trillion compared to N29.6 trillion in 2016. All of this may have culminated in the commercial bank’s willingness to increase head count in the third quarter of the year.
Despite the increased hiring recorded in the third quarter of 2017 and robust profits, the Nigerian banking sector has added net jobs of just 61 in this year alone. If you also consider the fact that banks typically downsize in the 4th quarter of the year, then it is likely that we may end the year with a net job loss for the banking sector.