The telecommunications industry reduced its workforce by 383 employees in one year following a sharp increase in operating costs, new data from the Nigerian Communications Commission has shown.

Figures from the NCC’s 2023 and 2024 Year-End Performance Reports indicated that total staff strength across licensed operators fell from 17,882 workers in 2023 to 17,499 workers in 2024. The decline occurred as operators’ operating expenses rose from N3.16tn in 2023 to N5.85tn in 2024, an 85.35 per cent year-on-year increase.

The NCC attributed the rise in costs to higher energy costs, inflation, foreign exchange challenges, and multiple charges imposed by state and local authorities. Although the commission secured zero Right-of-Way fees in some states, many operators continued to report high costs of network deployment and maintenance.

“N5,854,257,451,225.71 is the total operating cost collated in year 2024 which increased by 85 per cent Year-on-Year from the N3,158,403,767,328.48.

“Most licensees complained of high Right-of-Way fees, harsh micro economic operating employment and rising inflation. However, the NCC has been able to secure zero ROW fees in some states in year 2024,” its latest 2024 Year-End Performance Report read.

The PUNCH further observed that GSM operators posted the most significant reduction in staff, cutting their headcount from 7,212 to 6,658 within the period. Internet Service Providers reduced their staff from 5,589 to 5,473, while the number of employees in the Value-Added Services segment fell from 813 to 713.

Fixed-line operators recorded a slight increase from 268 to 272 workers. However, staff numbers increased in two categories. Collocation and Infrastructure Sharing providers grew from 1,574 employees in 2023 to 1,751 in 2024, while the “Others” category rose from 2,426 to 2,632. These gains did not outweigh the reductions recorded in the GSM, ISP and VAS segments.

The workforce adjustment followed a major drop in active voice subscriptions after the enforcement of the NIN-SIM linkage policy. Active subscriptions fell from 224.7 million in 2023 to 164.9 million in 2024, a 26.61 per cent decline, while Teledensity fell from 103.66 per cent in 2023 to 76.08 per cent in 2024.

The report read, “As at December 2024 total active voice subscriptions for the entire market segments was 164,926,599 as against 224,713,710 recorded as at December 2023. This indicates a decline of 26.61 per cent in 2024.

“The decline was attributed to the removal of Subscriber Identification Modules that are not linked to verifiable National Identification Numbers and the rectification of a major discrepancy by a Mobile Network Operator explains the significant drop in Nigeria’s telecoms subscriber base.

“Teledensity also recorded a corresponding decline of 26.61 per cent. Teledensity was 76.08 per cent in 2024 as against 103.66 per cent recorded in 2023 which is as a result seen in the Voice segment above.

“From September 2023, teledensity is calculated based on the Nigerian Population Commission’s projected population figure of 216 million.”

Despite the fall in subscriber numbers, the sector recorded growth in capital investment. CAPEX rose from N990.55bn in 2023 to N2.90tn in 2024, driven by the higher value of imported equipment and ongoing network expansion.

Operators increased the number of towers from 39,356 to 39,880 and base stations from 137,992 to 145,141. Fibre deployment also increased. Industry revenue rose from N5.30tn in 2023 to N7.67tn in 2024, a 44.70 per cent increase.

However, operators stated in their submissions that rising costs continued to affect their operations and planning. Telecoms contributed 14.40 per cent to Nigeria’s GDP in Q4 2024, compared with 14 per cent in Q4 2023.

Earlier in 2023, The PUNCH reported that telecommunications operators had begun cutting operating costs and may lay off staff in the coming months if the naira depreciation is not addressed.

An official in the Association of Licensed Telecommunications Operators of Nigeria, who is familiar with developments in the sector, said small telecom operators would be affected the most. The source, who spoke to our correspondent in confidence, due to the lack of authorisation to speak on the matter, noted that some small operators had begun to sack workers to survive worsening economic realities.

Last year, The PUNCH reported that Nigeria’s telecom sector risked shutdown as about 800 workers from the Private Telecommunications and Communications Senior Staff Association embarked on strike, threatening to cripple services nationwide.

The union, largely contract staff, warned of massive disruptions to telecom operations if its demands were not met, as this would leave millions of subscribers to face a potential communication blackout.

“The strike has become inevitable because of the prevalent precarious working conditions our members are enduring in the sector, the refusal of the employers to recognise and respect the constitutional right of these workers to freely associate with the union, and the unjust sack of three members of the union,” it stated in its seven-day strike notice.