Workers in Ghana have been told to brace themselves for tough economic times, but according to Economist Prof. Godfred Bokpin, there’s a glaring problem, many already have no belts left to tighten.
Speaking on The Big Issue on Channel One TV on February 22, 2024, Prof. Bokpin criticized the government‘s recent 10% wage increase for public sector workers, arguing that it does little to address the financial struggles of employees amid rising inflation and economic hardship.
“People are watching, and public sentiments feed into wage demands,” he noted. “Organized labour will hold out for more because you can’t tell us to fasten our belts when we don’t have belts in the first place.”
His comments reflect growing dissatisfaction among workers who argue that the wage adjustment falls far short of meeting the cost of living. Inflation remains high at 23.5%, meaning the 10% wage increase does not keep up with rising prices of goods and services.
Wage Increase Falls Below Inflation and Global Poverty Line
The government announced the 10% increment in the daily minimum wage after negotiations at the National Tripartite Committee (NTC) meeting on February 20, 2025. The new wage is now GH¢19.97, up from GH¢18.15. However, in dollar terms, it has dropped from US$1.51 in January 2024 to US$1.29 due to the cedi‘s depreciation.
This means that in real terms, workers earning the minimum wage are worse off than before. The increase also fails to lift them above the World Bank’s global poverty line of US$2.15 (GH¢33.3), keeping them in extreme poverty.
Similarly, public sector workers saw a 10% rise in their base pay, a figure that also lags behind inflation. Over the years, organized labour has used inflation as a key benchmark for wage negotiations, yet this latest increment does little to bridge the gap.
Economic Pressures and Government’s Plea
The wage increase comes at a time when Ghana is facing a severe economic crunch, with high debt levels and limited fiscal space under an IMF bailout program. Despite acknowledging the inadequacy of the increment, President John Dramani Mahama has pleaded with organized labour to bear with the new government due to economic constraints.
“We recognize that this is not enough, but we are asking workers to bear with us as we work towards improving the situation,” he assured.
However, Prof. Bokpin and labour unions argue that without stronger government measures to curb wasteful spending and improve economic conditions, workers will continue to struggle.
