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This work oneconometric investigation on the impact of strike disruption (action) on labour productivity in Nigeria specifically looked at the following objectives such;to ascertain the relationship between work disruptions (strike actions) and labour productivity; to evaluate the extent to which work disruptions affect labour productivity and to determine the factors that influence work disruptions on labour in Nigeria.as such, this work used the econometric method approach for the research. There is no doubt that the method will facilitate the model specification, parameter estimation and appropriate econometric tests. Therefore, the use of time series is based using secondary data sources because of the attitudes and perceptions about work disruption as it affects labour productivity.In order to capture the impact of industrial crisis, measured by man days lost (D)the Cobb-Douglas production function was employed while the real capital stock-K, derived by dividing gross fixed capital formation by consumer price index-(CPI), and labour force (L).Result shows that Strike action has no significant impact on labour productivity. Having employed all necessary statistical and diagnostic tests, the hypothesis was evaluated with ECM result which was used to tested the hypothesis two of this study, we observed that the coefficient of ECM is stood at -9% which denotes that it will take about 9 years Speed of adjustment for Real Gross Domestic Product (RGDP) to attain to equilibrium from the short-run dynamics resulted from the occurrence in industrial strike actionproxied by the independent variables (Real capital stock on service sector (K), Labour force on service sector (L) and Hours loss in service (D) in Nigeria.In other words; “Strike action has significant impact on labour productivity during the chosen period of observation”.Nigeria has experience series of industrial strike action, and they must have some level and rate of impact on the gross domestic product of the nation. The study therefore recommends that Government should ensure that capital expenditure and recurrent expenditure should be managed in a manner that it will ensure control of the occurrences of industrial strike actionthus, focus on how to raise the nation’s production capacity.
1.1 Background of Study
Strike action also called labour strike, or simply strike, is a work stoppage caused by the mass refusal of employees to work. A strike usually takes place in response to employee grievances. Strikes become common during the Industrial Revolution, when mass labour become important in factories and mines. Strikes are sometimes used to pressure governments to change policies. Occasionally, strikes destabilize the rule of a particular political party or ruler; in such cases, strikes are often part of a broader social movement taking the form of a campaign of civil resistance (Aleksander, 2009).
Unemployment has been categorized as one of the major and serious impediment to social and economic progress. Unemployment is a very serious issue in Africa and particularly in Nigeria. Nigeria has a population of over 40 Million unemployed persons. Indeed, the Nigerian landscape is crawling with a rapidly mutating population of jobless able-bodied men and women who are frustrated and whose disempowerment accounts largely for the reign of cynicisms in the country and a high mortality rate. We should realize that from the onset, the unemployment problem is a political economy issue which economic reforms have failed to address and hence cannot be addressed through market forces. The Nigerian economies because of its relative diversification and level of development in the African regions have potentials for exploiting the benefits of globalization. However, the dualism problem is militating against the realization of its potentials. The economy needs rapid growth to absorb the growth in the labour force (Egbere, 2014).
The evidence from the recent experience suggest that large savings in economic activity associated with financial boom-bust recovery cycles have consequences for growth and labour market conditions in developing countries. Labour market conditions deteriorated in all countries with the outbreak of globalization. Indeed, it appears that reduced income and unemployment in unorganized and informal markets have been the adverse impact of globalization on poverty and inequality. Decline in wages and growing unemployment combined to produce a sharp increase in poverty throughout the developing economies (Chripanhura and Makwararara, 2012).
The labour market has increasingly witnessed crisis in the globalization era. A considerable number of studies have shown that the inequality of earnings for workers around the world has widened with the outset of globalization and the rising wages of skilled workers relative to unskilled workers is an important cause of this increase in inequality. Various explanations exist for the rising relative wage of the skilled compared to the unskilled worker in Asia, Latin America and U.S. during the 1980’s and 1990’s (Lewis 2011).
It is also observed that economic growth rates in the developing countries are insufficient to absorb the growing pool of unemployed labour has been estimated that mass unemployment among the semi-skilled and unskilled will not fall significantly below 30% in the medium term. It is noted that unemployment is structural and will not be significantly reduced in the coming decades without major state intervention (Lewis 2011).
1.2 Statement of the Problem
The unstable industrial relation climate in Nigeria just within the decades has resulted in all-time record of lost working hours, unprecedented work stoppage as a result of strike action. By October 1981, both federal and state Government were broke by December seven out of the nineteen state Governments could hardly pay the salaries of their employees; by June 1982, Bendel, Rivers, Cross Rivers, Benue and Imo State were owing teachers two to four months arrears. It was only when junior workers actually abandoned classes in Bendel State after not receiving January salaries as at April 1982 that both Government cleared part of the outstanding amount. In the first six months of the year 1982, Nigeria lost a total of 4,598 man-hours because of strike action by workers. The strike action embarked by Nigeria Labour congress in January, 2012 has cost the country millions of naira as all the sectors of the economy which engage in productivity activities in order to boost the gross domestic product of the economy were closed for couples of days.
In Nigeria, the law allows all workers to form or join unions, with the exception of members of the armed services, the police force, firefighters, Central Bank employees and customs and excise staff. While the first recorded strike action in history took place during the reign of Ramses III in the twelfth century BC, health workers’ strikes have remained commonplace throughout history as well as in Nigeria (Ogunbanjo, Knapp van Bogaert, 2009).
The first nationwide strike by the organized workforce in Nigeria was on 21 June 1945 by about 150, 000 clerical and non-clerical workers in the Nigerian civil service, demanding better wages in response to the rising cost of living brought about by the Second World War (George, 2015).
In the last 36 months, the Nigerian health system has experienced more than eight different strikes involving doctors, nurses and allied healthcare workers (Olatunji, 2013; Olokor, 2013).
These strikes have negatively impacted on the healthcare system, leading to several avoidable deaths, complications and outgoing medical tourism, as the wealthy seek health services abroad (Adebimpeet al., 2010).
The impact of these strikes is worst when they occur at periods of national health emergencies such as the recent Ebola viral disease outbreak, Lassa fever or cholera outbreaks or even man-made emergencies like Boko Haram suicide bombings with mass casualties (Oleribe, et al., 2015).
Reasons abound why healthcare workers go on strike in true underlying causes of industrial action Nigeria, and these include career stagnation, perceived discriminatory policies and demoralization from working in systems with poor infrastructure, manpower shortages and poor personal remuneration (Ogunbanjo and Knapp van Bogaert, 2009). However, in recent times, there has been a division of opinion on pinpointing the true underlying causes of industrial action (Botero, et al., 2014).
1.3 Objectives of the Study
The broad objectives of this study is to investigate an econometric impact of work disruption (strike actions) on labour productivity in Nigeria.
The study is precisely focused on following issues;
To ascertain the relationship between work disruptions (strike actions) and labour productivity.
To evaluate the extent to which work disruptions affect labour productivity.
To determine the factors that influence work disruptions on labour in Nigeria.
1.4 Research Question
What is the relationship between work disruptions (strike actions) and labour productivity?
How does work disruption affect labour productivity in Nigeria?
What are the factors influencing work disruption by employees in Nigeria?
1.5 Working Hypothesis
Ho1: There is no significant relationship between strike action and labour productivity in Nigeria
Ho2: Strike action has no significant impact on labour productivity in Nigeria
1.6 Justification of the Study
This study is intended to help labour productivity of any established organization either public or private toward realizing the organization either public or private toward realizing the importance of well-organized strikes action that will bring about growth on the organization. It also will help Government parastatals towards solving employee grievances and strike action.
The strike action help the labour productivity members to know their legitimate nights as employees and how to institute strike as a tool of compelling Government to implement certain welfare practices that will boost their moral towards work.
In Nigeria of today, both private and public organization are facing a lot of problems owing to strike action by workers or employees. This has inevitably resorted to low productivity in most firms and to some it has been of great employer as confusion is always the resultant effect, this work will therefore be of great important to the employees and employers on the private sector of the economy.
1.7 Scope of the Study
The scope of the study covers the affairs of the labour productivity from members in service sector as regards to the strengths, weakness, opportunity and threat in which the research is based on labour productivity in Nigeria. The research is conducted to cover and improve the management of the organization towards labour productivity in Nigeria.
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