THE GROWTH OF INDUSTRIES IN NIGERIA: PROBLEM AND PROSPECT

THE GROWTH OF INDUSTRIES IN NIGERIA: PROBLEM AND PROSPECT

(A CASE STUDY OF AJAOKUTA STEEL COMPANY)

Abstract

Empirical evidences from the developed and few emerging economies have shown that the producing unit of the economy tends to influence the entire economy’s performance and stability. But, without adequate finance, incentive of operations, business friendly environment, effective management and operation structure, growth-oriented government policies and regulations, the manufacturing firms’ will not perform as expected. The rate of firms exit in the Nigeria’s manufacturing sector prompted this study, to analyze the dynamics of manufacturing firm’s growth in Nigeria using panel analysis. The panel regression model employed emanated from the neo-classical, managerial, and optimum firm’s size theories and theGibrat’s Law of Proportionate Effect. Multi-stage sampling technique was used to survey 45 manufacturing firms quoted under the Nigerian Stock Exchange (NSE) between 1989 and 2008. The estimated dynamic panel model revealed that the manufacturing firms finance mix, utilization of assets to generate more sales, abundance of funds reserve and government intervention as indicated by Tobin’s Q, operating efficiency, capital reserve and government policies are significant determinants of manufacturing firms’ growth and dictated their dynamics in Nigeria. Also, that the Gibrat’s component enhanced the growth rate of

manufacturing firms’ sales, profit and capital employed dynamically in the manufacturing sector.

 Keywords: Firms, Manufacturing, Growth, Determinants, Panel data, Nigeria

CHAPTER ONE

1.1            INTRODUCTION

The Success or failure of any organization depends largely on the cordial labour/ management relation. Since they are partners in progress  in an organization. Following the industrial revolution of the 18^th and 19^th century in Britain and Autralia/USA.

The idea of labour/management was evolved. During this period, as the rate of industrialization progressed the power vested on the employees were curtailed, hence the employer could no longer dictate every pace at the work place, these ideas hitherto evolved and pave way for pluralistic ideologies and hence management /labour relations was institutionalized.

However, in Nigeria the emergence of wage employment made labour/management relations a strange one, until during colonial administrative that wage is used as a means of compensating workers for services rendered.

At the end of the first would war, labour became surplus, this excess labour brought about the exploitative tenderness of workers employment were determined by the forces of demand and supply.

The ideas of the classical economists were institutionalized in the labour market. This no doubt brought about industrial misery, this is so because the bargaining power of the labour was far worker than the position of the employer.

This was the starting point of labour/management conflict.

Several variables have been identified as the courses of growth of industries growth in Nigeria between unions and the employers (management) within the organization which include: when perceived right and privileges are denied or trampled upon, deliberate creation of communication gap between employees and employers, when management fails in its responsibilities or basic functions e.g. payment of salaries, promotion, job and personal/property security etc.

The emergence of trade union ideologies brought a new objective into labour/management relation which is primarily to improve the working conditions and increase in wages and secondly to protect the interest of their members. Example of trade unions are the Nigeria Labour Congress (NLC) Trade Union Congress (TUC) Nigeria Union of Teachers (NUT).

However, the unions adopt agitation as a tool for expressing their grievance to the management which enable labour/management reconcile its conflicts through consultation and collective bargaining.           

1.2            STATEMENT OF PROBLEM

The problem of management is a common issue in an Organization, which Ajaokuta Steel Company is not an exception. People sees the problem of ASCL to ineffective and corruption which leads to series of conflict as a result of non-payment of salaries and allowance for some months now. All these referred the progress of the company.

1.3             OBJECTIVE OF THE STUDY

The study aims at identifying ways to create a conclusive atmosphere in which the workers of Ajaokuta Steel Company can be motivated to contribute towards the realization of the objective for which it was set- up. And to identify factors adversely affecting the relationship between the employers and the employees.

The objective of the study includes:

i.        To identify causes of industrial conflict and to prefer solution  

ii.      To suggest ways to create conclusive atmosphere for workers of Ajaokuta Steel Company.

iii.    To look at the negative effect of affecting the growth of the industrial.

iv.    To recommend possible ways of the management of industrial conflicts.

v.      To identify the role of management (employer) and the labour (union) in the management of industrial conflicts.

1.4             THE SIGNIFICANCE OF THE STUDY

The subject is significant for a number of reasons, some of which  are as follows:

i.        It provides data for future researchers who intend to undertake a study on the management of industrial.

ii.      It will equally go along way to guide us in our bid to understand the problems and prospects of employees and their employers.

iii.    It also gives us insight into the responsibilities of management that were neglected which leads to industrial disputes and to identify solutions to the above disputes to ensure smooth and enduring labour/management relation.

iv.    Lastly, given that labour had experienced authoritarian management regime, it is important to establish rules to protect the rights of labour to avoid law-offs and sacks without pay as in the past. 

1.5             SCOPE/LIMITATION OF THE STUDY

The researchers intend to properly look at the relationship that exist between the labour and management of Ajoakuta Steel Company Limited.

The study will also offer useful suggestions on how to manage the growth and promotion of the  organization for peaceful atmosphere, particularly ASCL. However, some limitations encountered during the study include:

i.                    Academic Work Load: The rate of academic work is too cumbersome to combine with project write up.

ii.                  Time: Time as you know is everything. Time was the greatest problem of the study because of tight schedule as a worker and part time student.

iii.                Access to records: Lack of free access to records resulting from the uncompromising attitude of those in-charge of giving vital data under the pretext of being “top secret” is a serious limitation.

iv.               Finance: In the course of undertaking a course of study, it always involved money. And money is a scarce resource, hence the prudent utilization of the little available one which negatively affects the quality of this write – up.   

1.6            THE RESEARCH QUESTIONS

In this project, we shall answer  the following Research Questions,  

i.                    Intensive approach to workers, general grievance and accumulated anger and frustration leading to open confrontations/disharmony is ASCL.

ii.                  Government policy affects labour/management relationship

iii.                Deliberate creation of communication gap which affects/management relationship.

 

1.7            DEFINITION OF CONCEPTS

1.                 Management: According to Oxford Advanced Learner’s Dictionary of current English sixth edition 2000. management is the act or skill of darling with people or situation in a successful way.

2.                 Industrial Conflict: This refers to conflict or dispute that may arise between the employees and the employers in particular industry.

3.                 Labour:Labour naturally is the energy, the intellect, the mental activities of individual contribution towards achieving a goal in the production of goods and services. Labour are the people that work in an organization.

4.                 Trade Union: Trade Union can be described as the coming together of workers (body) in order to enable them struggle for their rights employers through collective bargaining.

5.                 Public Sector: This refers to the section of the economy established and control by the government which could be profit or nonprofit oriented.

6.                 Dispute/Shrike Resolution: Strike is the total stoppage of labour supply in order to bring pressure on employers to accede to the demand of employees (labour unions) in an organization.

7.                 Grievances:  This refers to unfairly treatment of workers by the management which could lead to breakthrough dialogue that causes of disputes are identified. Analyzed and solution are found.

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