AN ANALYSIS OF CIVIL SERVANTS EXPERIENCE AMIDST ECONOMIC STAGNATION UNDER TINUBU ADMINISTRATION

CHAPTER ONE

INTRODUCTION

Background of the Study

Economic stagnation refers to an extended period characterised by sluggish or negligible economic expansion, often accompanied by elevated levels of unemployment and stagnant wages. A stagnation is different from a recession since it involves a lengthy period of low growth, which may not necessarily result in a decline in economic activity but leads to a lack of economic vibrancy. During periods of economic stagnation, the rates of growth in Gross Domestic Product (GDP) persistently remain at a low or stagnant level for an extended period of time. Nevertheless, the stagnation is caused by other factors, including inherent issues within the economy, such as outdated infrastructure, weak regulatory systems, and a lack of innovation. 

In addition, external causes such as worldwide financial crises, political instability, and pandemics can exacerbate stagnation by disrupting economic operations and reducing investor confidence (Kayode, 2019). Unemployment is a crucial component of economic stagnation. Businesses often display hesitancy to hire due to an ambiguous economic forecast, leading to elevated and enduring levels of unemployment. This hesitancy produces a detrimental cycle in which less consumer spending continues to hinder economic growth, resulting in a decline in job opportunities (Adebamowo, 2019). Prolonged unemployment frequently leads to a deterioration of abilities, which in turn exacerbates individuals' difficulty in securing employment, so perpetuating a state of stagnation. 

There is a substantial correlation between wage stagnation and economic stagnation. During periods of economic stagnation, earnings often remain stagnant, failing to keep up with inflation. The absence of wage growth reduces consumers' purchasing power, leading to a decline in demand for products and services (Mishel, Bivens, Gould, & Shierholz, 2018). Consequently, firms experience a decline in their profits, which in turn limits their ability to invest and expand. Consequently, this contributes to the general condition of economic stagnation. 

Investment, whether from the public or private sector, has a vital role in determining economic stagnation. Lack of sufficient investment in infrastructure, technology, and education might hinder the growth of productivity, which is essential for long-term economic expansion. In 2017, Ndoricimpa introduced the concept of "secular stagnation," which suggests that a prolonged period of economic stagnation can arise from a persistent lack of demand for investment. This theory posits that specific structural factors, such as an increasing population of elderly individuals and elevated levels of savings, lead to a reduction in the demand for investment. Consequently, there is a surplus of savings relative to investment, leading to low interest rates and sluggish economic growth. 

Inflation patterns during periods of economic stagnation might display fluctuations. Stagnation can also occur alongside low inflation or even deflation, as demonstrated by Japan's "Lost Decade" in the 1990s (Koo, 2019). Conversely, stagflation, which is the simultaneous occurrence of economic stagnation and high inflation, emerges due to supply-side shocks, such as the spike in oil prices in the 1970s (Blinder, 1979). Both scenarios provide significant challenges for policymakers, as traditional monetary and fiscal approaches may prove ineffective or potentially yield negative consequences. 

The consequences of economic stagnation on society and politics are substantial. Prolonged periods of lacklustre economic growth can lead to increased inequality, as persons with lower incomes are disproportionately affected by decreases in employment and stagnant earnings (Ifabiyi et al., 2018). The growing inequality in the distribution of income can result in social unrest and political instability, as underprivileged people demand more equitable economic policies and greater government intervention to promote economic development and improve living standards.

The economic conditions in Nigeria have had a profound impact on the public sector, which employs a substantial number of workers. Civil servants, who are essential in the management and provision of public services, have faced significant difficulties.

Bola Ahmed Tinubu became the President of Nigeria in May 2023, with the nation having great hopes for economic changes and expansion. Nevertheless, the administration encountered a challenging economic situation characterised by sluggish economic expansion, elevated inflation, and a delicate fiscal climate. The administration faced difficulties in achieving its economic objectives due to the global economic slump, volatile oil prices, and pre-existing structural inadequacies, which were further worsened by these issues (World Bank, 2023). 

Statement of the Problem

Economic stagnation, which refers to extended periods of limited economic expansion, elevated unemployment rates, and inflation, has far-reaching effects on diverse sections of society.Civil servants are facing additional difficulties due to the high inflation rates. The exponential rise in the costs of necessary commodities and services has significantly diminished their ability to buy, hence posing challenges in sustaining a satisfactory quality of life. This issue is especially critical because the salaries of civil servants have not increased in line with inflation, resulting in a decrease in their real income. Due to the cost of living crisis, several civil servants have resorted to acquiring extra employment or participating in informal economic endeavours to augment their salaries (Central Bank of Nigeria, 2023). Hence, it is in the light of these that the study seeks to analyze civil servants experience amidst economic stagnation under Tinubu administration.

 1.3  Objectives of the Study

The main purpose of this study is to analyze civil servants experience amidst economic stagnation under Tinubu administration. Specifically, the study will;

Determine the extent to which economic stagnation affects the job satisfaction and morale of civil servants.

Evaluate the impact of economic stagnation on the financial well-being of civil servants.

Examine the effect of economic stagnation on the career development opportunities for civil servants.

Analyze the coping strategies employed by civil servants to manage economic stagnation.

1.4  Research Questions

The following questions have been prepared for the study:

To what extent does economic stagnation affect the job satisfaction and morale of civil servants?

What is the impact of economic stagnation on the financial well-being of civil servants?

How does economic stagnation affect the career development opportunities for civil servants?

What are coping strategies employed by civil servants to manage economic stagnation?

1.5 Research Hypotheses

H0: Economic stagnation has no significant impact on the financial well-being of civil servants.

Ha: Economic stagnation has significant impact on the financial well-being of civil servants.

1.6 Significance of the Study

The results of this study will be useful in formulating financial management and investment strategies that are specifically customised for civil servants. Additionally, civil servant unions and advocacy groups can utilise this information to enhance their bargaining power in negotiating job conditions and perks, so ensuring the protection of their members' financial interests, especially in times of economic stagnation.

Furthermore, the study will enhance the comprehension of the economic environment for the business community and investors. If it is determined that economic stagnation does not have a substantial effect, businesses can concentrate on alternative indicators that stimulate growth and adapt their investment strategies accordingly. This would empower enterprises to efficiently traverse the Nigerian market, promoting a more robust and flexible private sector. In addition, educational institutions and researchers will use the findings to enhance their curricula and research agendas, thus ensuring that future economists and business leaders are more equipped to contribute to Nigeria's economic progress.

1.7 Scope of the study   

The scope of this study is boarded on civil servants experience amidst economic stagnation under Tinubu administration. Empirically, the study will determine the extent to which economic stagnation on affects the job satisfaction and morale of civil servants, evaluate the impact of economic stagnation on the financial well-being of civil servants, examine the effect of economic stagnation on the career development opportunities for civil servants and analyze the coping strategies employed by civil servants to manage economic stagnation.

Geographically, the study will be delimited to residents of Edo state.

1.8 Limitation of the study

In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents. In addition, there was the element of researcher bias. Here, the researcher possessed some biases that may have been reflected in the way the data was collected, the type of people interviewed or sampled, and how the data gathered was interpreted thereafter. The potential for all this to influence the findings and conclusions could not be downplayed. More so, the findings of this study are limited to the sample population in the study area, hence they may not be suitable for use in comparison to other schools, local governments, states, and other countries in the world.

 1.9 Definition of Terms

Economic stagnation: Refers to a prolonged period of slow or negligible growth in an economy.

Civil servants: Employees of the government who work in various departments and agencies to implement policies, provide public services, and ensure the smooth functioning of government operations.