Vol 5 No 9 (2019): International Journal For Research In Business, Management And Accounting (ISSN: 2455-6114)
Articles

WAGE AND SALARY COST IMPACT ANALYSIS: EVIDENCE FROM FINANCIAL PERFORMANCE OF NIGERIAN QUOTED MANUFACTURING FIRMS

JOHN OHAKA
PhD Department of Accountancy, Rivers State University Port Harcourt, Rivers State - Nigeria
KINGSLEY GBEKE KALAGBOR
PhD Department of Accountancy, Ignatius Ajuru University of Education Rumuolumeni, Rivers State – Nigeria
OLUKA NYIME OBULOR
Department of Accountancy, Ignatius Ajuru University of Education Rumuolumeni, Rivers State - Nigeria
Published September 13, 2019
Keywords
  • Financial performance,
  • Human resource cost,
  • Nigerian firms
How to Cite
JOHN OHAKA, KINGSLEY GBEKE KALAGBOR, & OLUKA NYIME OBULOR. (2019). WAGE AND SALARY COST IMPACT ANALYSIS: EVIDENCE FROM FINANCIAL PERFORMANCE OF NIGERIAN QUOTED MANUFACTURING FIRMS. International Journal For Research In Business, Management And Accounting (ISSN: 2455-6114), 5(9), 01-16. Retrieved from https://gnpublication.org/index.php/bma/article/view/1094

Abstract

This study examined the impact of human resource cost on financial performance of quoted manufacturing firms in Nigeria. An ex-post facto research design was adopted to constitute panel data for a period spanning 2008-2017. Wage and salary cost, return on equity and earnings per share served as proxies for the study variables. The population comprises 20 firms, which were all selected. Their financial statements, which are contained in Nigerian Stock Exchange publications, formed the secondary data for analysis. The results featured in terms of Correlation Coefficient (R), Coefficient of Determination (R2),T-test,F-test, Auto-correlation test, and Granger Causality test values. The first null hypothesis was rejected (1.660 critical t-value at 0.05 < 2.421 computed t-value), in favour of the alternate hypothesis, which states that wage and salary cost has significant impact on return on equity. Similarly, the second null hypothesis was rejected (1.660 critical t-value at 0.05 < 2.968 computed t-value), in favour of the alternate hypothesis, which states that wage and salary cost has significant impact on earnings per share. By this, it is established that human resource cost has significant impact on financial performance of quoted manufacturing firms in Nigeria. It is, therefore, recommended that the firms should provide attractive compensatory and incentive packages in order to boost human resource productivity and consequently stimulate corporate financial performance. Also, more recognition should be accorded investment – portending costs, while the routine expenses should be treated with greater managerial prudence.

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