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Nigeria’s 70,000 Naira Sham

February/March 2025Nigeria
minimum wage

Photo illustration by Dami Mojid / THE REPUBLIC.

THE MINISTRY OF business x the economy

Nigeria’s 70,000 Naira Sham

The Nigerian government recently approved an increase in the country’s minimum wage from N30,000 (approximately US$20) to N70,000 (approximately $47). While this increase aims to ease the financial strain on many Nigerians, the reality of the new minimum wage for the average citizen remains harsh.
minimum wage

Photo illustration by Dami Mojid / THE REPUBLIC.

THE MINISTRY OF business x the economy

Nigeria’s 70,000 Naira Sham

The Nigerian government recently approved an increase in the country’s minimum wage from N30,000 (approximately US$20) to N70,000 (approximately $47). While this increase aims to ease the financial strain on many Nigerians, the reality of the new minimum wage for the average citizen remains harsh.

Nigeria’s journey to a new minimum wage has been anything but smooth. The last wage adjustment in 2019 raised the minimum wage from ₦19,000 to ₦30,000, and by 2024, the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC) were demanding another wage increase. Initially, the unions proposed a ₦615,000 minimum wage, arguing that anything lower would fail to address the rising cost of living. The government countered with an offer of ₦48,000, which sparked outrage leading to widespread strikes. After weeks of stalled negotiations, back-and-forth proposals and growing public frustration, the government eventually raised its offer to ₦60,000 (approximately US$40). Labour leaders, however, insisted this amount was still insufficient, having already shifted their initial demand to ₦497,000 and later to ₦494,000.

Amid the prolonged deadlock and a two-day nationwide strike that crippled essential services, from hospitals to airports, President Bola Tinubu intervened, leading to a final agreement of ₦70,000 (approximately $47) to avoid further economic disruptions, with leaders of the NLC and TUC accepting this amount on the stipulation that wage reviews be done every three years rather than five. However, this victory on paper—more than double the previous minimum wage—still fell far short of the unions’ initial demand, failing to reflect the reality of Nigeria’s spiralling inflation. The announcement felt hollow for many Nigerians. Even among those relieved by the increase, concerns about its real impact lingered. Now, almost a year after the minimum wage increment, food prices have continued to rise, transportation costs are not easing off and essential goods are slipping farther out of reach; and the new wage raises a critical question: What does the increase truly mean for the average citizen?

THE NIGERIAN MINIMUM WAGE REALITY

In June 2024, food inflation in Nigeria surged to 40.9 per cent, significantly higher than the 25.3 per cent recorded in June 2023, according to the National Bureau of Statistics (NBS). An October 2023 report by Proshare, citing Numbeo, estimated the monthly cost for a family of four in Lagos, without rent, at N1.24 million, while for a single person, it was N343,092. This stark disparity between income and expenditure is evident in the experiences of individuals like Bukola*, a 25-year-old National Youth Service Corps (NYSC) corper in Ogun State. ‘My monthly expenses far exceed my income from the government, which is currently N33,000. Even with the new minimum wage, it won’t significantly alleviate my financial strain as the cost of living keeps increasing daily.’ Bukola also expressed frustration with the country’s economic situation, advising those who could leave Nigeria to do so.

Similarly, Ayodele*, a 33-year-old architect and senior project manager in Lagos, who earns between N300,000 and N400,000 monthly, still struggles to manage transportation, utility bills and basic living expenses. He copes by buying in bulk and limiting his spending, but he noted that the inflated prices of goods make it increasingly difficult to stretch his income. Ayodele also stressed the need for government intervention to reduce inflation and improve infrastructure, describing the economic situation as ‘in shambles’. He expressed hope for a stabilized economy where all Nigerians can thrive, not just those earning above the minimum wage.

When asked about the current economic situation in Nigeria, Ejiroghene*, a 23-year-old PR coordinator living in Lagos, Nigeria, voiced her bleak outlook:

I think the country is going to sh*t—excuse my French. I think we’re getting to the part of the book when people ‘eat the rich’, and it’s not looking good. I don’t have high hopes. I’m just trying to earn more than my last pay every day. The government should scrap NYSC and instead subsidize education to help more people gain access to better opportunities through exposure and their earned degrees.

Ejiroghene teaches in a public school as part of her NYSC programme and currently earns N233,000 monthly from her primary job, with an uncertain future increase to approximately N270,000.

To provide more clarity, I spoke with Isenere Dotun, a fixed-income analyst and PhD economics student at the University of Lagos. When asked to assess the new minimum wage and how it compares to previous wage adjustments, particularly in terms of purchasing power, Dotun explained:

The new minimum wage reflects the widely held belief that increasing an employee’s earnings will naturally lead to an improved standard of living and better quality of life. However, in recent years, this has not been the case in Nigeria. Historical wage adjustments in terms of purchasing power are typically assessed using the cost-of-living adjustment technique to ensure wages keep up with inflation. While this is often part of union contracts or government policy, in Nigeria’s context, even with wage increases, the rising cost of living and inflation tend to cancel out any real benefits, leaving many citizens no better off than before.

Dotun further explained how inflation is undermining the real value of the new minimum wage:

Inflation erodes purchasing power over time, meaning that the new wage will buy less as prices continue to rise. There is an inverse relationship between wages and the general price level, where the cost of living, particularly for necessities such as food, housing and transportation, continues to outpace wage growth. In Nigeria’s case, even with wage increases, inflation quickly diminishes any positive impact, leaving citizens struggling to meet basic needs.

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THE NIGERIAN MINIMUM WAGE IN CONTEXT

Nigeria’s minimum wage lags behind other economies in the broader Africa, despite it being Africa’s fourth-largest economy. In South Africa, for instance, the national minimum wage is approximately R4,543.44 per month (based on a 40-hour work week at R27.58 per hour), which is roughly US$240. While the cost of living in South Africa varies, this comparison underscores the relative insufficiency of Nigeria’s wage increase in addressing economic challenges. According to a July 2024 report by SBM Intelligence, Morocco leads with the highest minimum wage in Africa at $286, followed by South Africa at $248. Egypt’s minimum wage is set at $157, Algeria at $141, while Kenya, Angola, Côte d’Ivoire, Tanzania and Ethiopia range from $136 to $52.

Several factors explain why these countries maintain higher minimum wages despite having smaller economies than Nigeria. Many, like South Africa and Morocco, have stronger labour laws and centralized wage-setting mechanisms that are regularly reviewed to keep pace with inflation. Additionally, countries such as Kenya and Côte d’Ivoire have diversified economies, meaning their wage structures are not solely dependent on volatile commodity prices, as is often the case with Nigeria’s oil-driven economy. These differences highlight the structural challenges Nigeria faces—not just in setting a higher minimum wage, but in ensuring that wages are regularly adjusted in line with inflation and economic realities.

Mary Ekemezie, a legal practitioner and labour rights advocate, disputed the new minimum wage as a living wage. She explained:

While it appears to be an improvement on paper, increasing from N30,000 to N70,000, it doesn’t translate to real progress. Today, N70,000 can’t buy a bag of rice. I don’t see how a family or any individual can survive on just N70,000. A tuber of yam costs between N5,000 and N12,000. How long can an average family survive on just one tuber? Even with a quarter-bag of rice at N20,000, when you add necessities like beans, onions, transportation and utilities, it’s clear that N70,000 doesn’t stretch far enough.

AJ Daggar Tolar, author, human rights activist and spokesperson for the Movement for a Socialist Alternative (MSA), offered a critical analysis for the new minimum wage within Nigeria’s macroeconomic framework. He argued that neoliberal policies such as deregulation and currency devaluation have severely undermined the real value of wages, asserting that: ‘These policies, driven by government-determined macroeconomic factors, indirectly devalue the currency, eroding the purchasing power of the minimum wage.’ Tolar also provided historical context, pointing out that when the N30,000 minimum wage was first introduced, it was worth approximately $98. However, due to inflation and economic policies, this value has since plummeted to about $20. He went on to say:

The stark depreciation underscores the inadequacy of the current minimum wage. And, as an import-dependent nation,  the naira’s international value directly influences domestic prices. This global economic tie means that the minimum wage, when evaluated in dollar terms, reflects a deeper economic issue.

Isere Dotun believes that the Nigerian government must implement a policy mix and structural reforms to stabilize the economy and ensure that the minimum wage keeps up with inflation. ‘Strengthening the naira, reducing reliance on oil exports, boosting local production and diversifying the economy are key steps Nigeria must take,’ he noted. Dotun highlighted successful examples from countries like Botswana, India, Canada and France, which have implemented regular minimum wage reviews and diversified their economies.

In Botswana, the government introduced a tiered minimum wage system that adjusts wages according to industry and economic conditions. Frequent wage reviews ensure that earnings keep pace with inflation, while social welfare programmes such as housing subsidies and free healthcare cushion workers from economic shocks. The country’s emphasis on economic diversification—particularly its investment in tourism, diamond mining and financial services—has helped reduce its dependence on a single revenue stream, providing a more stable economic environment for wage growth. In 2023, Botswana’s minimum wage, differing by industry, was P1,786 (US$136.56) per month, almost three times Nigeria’s current minimum wage.

India, on the other hand, with a large population and vast informal economy like Nigeria, faced persistent challenges in enforcing a fair minimum wage. The country’s wage-setting system is complex, with both central and state governments holding authority over wage regulations, leading to significant regional disparities. Many workers, especially in the informal sector, still earn below the legal minimum. To address these challenges, India implemented the Code on Wages Act 2019, consolidating minimum wage laws across industries and improving enforcement mechanisms. Additionally, the Setting Adequate Wages (SAW) project has been instrumental in reforming minimum wage systems across key states such as Assam, Jharkhand, Telangana and Tamil Nadu. These reforms have not only improved wage compliance but have also strengthened social protections for millions of workers.

Dotun noted that Nigeria could benefit from similar approaches to these countries, particularly in ensuring evidence-based wage adjustments, diversifying economic sectors and enforcing minimum wage laws effectively. He also analysed how the current wage policy impacts the broader Nigerian economy:

The wage policy has implications for unemployment, productivity and economic growth. If wages are not raised to match rising costs, we risk higher poverty levels, inequality, social unrest and political instability. The consequences of maintaining inadequate wages could be dire for Nigeria’s future.

Nigeria’s minimum wage rose from N125 in 1981 to N30,000 in 2019. A historical analysis by Abayomi Fawehinmi outlines the evolution of the minimum wage policy in Nigeria, revealing that, despite numerous reviews and adjustments, the minimum wage has not significantly improved in real terms. As a result, even though nominal wages have increased, the real value—what those wages can actually buy—has not improved proportionately.

AJ Daggar Tola, reflecting on this shift, emphasized the severity of the decrease:

In 1981, when N125 was introduced. With the dollar at just 67 kobo, the minimum wage was $221. So, what is N70,000 today? If Nigerians were earning $221 in 1981, why is it that, after 45 years, the ruling class has not deemed it fit to appreciate our lives more? And it has given N70,000, which in dollar value is just above $45, or not up to $45. Mind you, a lot of governors have come out to say that they can’t afford to pay that money. So, we have a ruling class that is telling Nigerians that we should be living 400 per cent below the wages we had in 1981.

Adding to the conversation, Dotun explained that the Nigerian economy has undergone several political, economic and structural changes over the decades, which have reshaped the macroeconomic landscape. Key factors such as inflation, fiscal regimes and exchange rate fluctuations have contributed significantly to this minimum wage disparity. He also pointed to Nigeria’s overreliance on oil, the Structural Adjustment Programme (SAP) of 1986, which caused mass unemployment and wage stagnation, and a weak wage adjustment mechanism as primary reasons for the real value decline of the minimum wage over time. This dramatic decline in real terms highlights significant economic challenges over the past 45 years.

In his May 2024 article published in The Conversation, Stephen Onyeiwu, professor of business and economics at Allegheny College, discusses how, despite periodic increases, the minimum wage in Nigeria is not spread across the board and takes a while to come into effect, if it ever does at all. This issue is compounded by the fact that many workers in Nigeria are employed in the private and informal sectors, where wage regulations are often less rigorously enforced. As a result, many earn below the official minimum wage or are not provided with adequate compensation. Several state governments have been slow to adopt the new minimum wage, with some workers still earning below the mandated amount. For instance, as of November 2024, seven states and the Federal Capital Territory had not approved the new wage. Some governors expressed reluctance to implement the new wage, citing financial constraints—a stance that feels increasingly insular amid rising inflation and worsening economic hardship.

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SURVIVING DESPITE THE MINIMUM WAGE

Given the inadequacy of the new minimum wage, many Nigerians have turned to various survival strategies, which often include taking on additional jobs or relying on the informal sector for supplemental income. ‘I work six jobs—five of them full-time but remote, one part-time—and still have to take on extra gigs like writing and poetry to survive, while also affording the occasional “baby girl” lifestyle,’ said Ren*, a 27-year-old resident of Lekki, Lagos. Ren’s situation, like many others, is a testament to the resilience and resourcefulness many Nigerians must exhibit—going as far as making lifestyle changes—to make ends meet. Nnenna, a 26-year-old teacher living in Enugu State, whose salary recently increased from N40,000 (N38,500 after taxes), to N45,000 told me:  

Everything is crazy expensive in this country. 70k can’t even feed you for a whole month. When you step into the market, it’s gone and you’ll be looking for what you spent it on. The government should redirect funds from government officials’ allowances to support ordinary citizens. I hardly go anywhere aside from my workplace and church.

Additional gigs, like English to Igbo translation, provide extra income for Nnenna, but they are not reliable. Expressing her frustration with the current economic situation, Nnenna continued, ‘I feel like screaming my lungs out. It’s so terrible that I do not even argue about it anymore.’ She hopes for improvement under the current government and wishes the president’s wife would stop advising citizens to plant maize and vegetables.

In urban areas, side businesses like make-up artistry, hairstyling and clothes selling, among others, have become popular ways to boost income. Usman*, a 28-year-old sales manager in Abuja, who earns N150,000 monthly, supplements his income by selling phone accessories. Yet, he still struggles to meet his expenses. ‘Sometimes I wonder if the government thinks we’re superheroes who can make money stretch like elastic. Being a man in this economy feels like being Superman without his cape.’ Communities also play a vital role in supporting individuals. Mutual aid groups, cooperative societies and local savings schemes like ajo or esusu provide financial support and a sense of solidarity. Ajoke, a coordinator of an ajo group from Ijebu Ode, highlighted how this practice has helped people cover rent, restock goods and pay school fees, among other expenses.

However, while juggling multiple jobs, engaging in small-scale trading, freelance work and other entrepreneurial activities reflect the collective strength of Nigerians, these strategies are not sustainable solutions. Although commendable, they often come at significant costs to personal well-being, as individuals sacrifice rest and leisure to maintain their income. The relentless hustle and multiple job commitments can lead to burnout, health issues and a diminished quality of life.

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BEYOND MINIMUM WAGE INCREASES

As Nigeria grapples with economic challenges, it’s clear that addressing the root causes of hardship requires a more comprehensive approach than just increasing the minimum wage. While wage increases provide immediate relief, they do little to tackle the systemic issues that perpetuate poverty and financial instability for millions of Nigerians. At the heart of these challenges is the nation’s reliance on an economy that has struggled to diversify beyond oil. The overdependence on oil revenues exposes the country to volatile global oil prices, leading to economic instability. Diversifying the economy by investing in sectors such as agriculture, technology and manufacturing is critical. These industries not only provide job opportunities but also reduce Nigeria’s vulnerability to external shocks, creating a more resilient economy.

In addition to diversification, inflation control is paramount. Addressing inflation requires a multi-pronged approach that include stabilising the currency, improving monetary policy and encouraging local production to reduce reliance on imports. Currency depreciation and rising costs of imported goods have been significant drivers of inflation, and without stabilizing these factors, wage increases will continue to be swallowed by the rising cost of living. Furthermore, the lack of infrastructure, particularly in transportation and energy, has contributed to high production costs and stunted economic growth. Investment in infrastructure goes beyond building roads and power plants; it’s about creating an environment where businesses can thrive and generate jobs. When transportation and energy costs are reduced, businesses can operate more efficiently, passing on the benefits to consumers and contributing to a reduction in overall inflation.

Another systemic issue is the high level of unemployment and underemployment. According to the National Bureau of Statistics (NBS), the combined rate of unemployment and time-related underemployment as a share of the labour force population increased to 17.3 per cent in Q3 2023, up from 15.5 per cent in the previous quarter. Additionally, about 87.3 per cent of workers were self-employed, while only 12.7 per cent were in wage employment. Even with wage increases, the economic strain remains significant if a large portion of the population is either unemployed or earning far less than they need to survive. The NBS also reported a rise in the unemployment rate, which reached five per cent in Q3 2023, further emphasizing the need for investing in education and vocational training that align with the demands of the job market. Equally important is fostering an entrepreneurial ecosystem that encourages innovation and supports small businesses. These efforts can help reduce unemployment and underemployment, providing more Nigerians with the means to support themselves and their families.

Addressing security concerns is also critical in addressing the root causes of the economic hardship. Economic progress cannot be achieved in an environment where insecurity stifles investment and disrupts daily life. The government must prioritize safety and stability to create a conducive environment for economic activities. When people feel secure, they are more likely to invest in their businesses and communities, contributing to overall economic growth.

Mary Ekemezie, on the root causes of the economic hardship, emphasized the critical need for the Nigerian government to execute effective policies addressing security, economic production and the cost of living. She critiqued the lack of clear policy direction, adding:

I’m not quite sure where we’re going as a nation at the moment. The government must recognize that they are servants of the people, not lords and masters. They need to listen, live by example and show that they are tightening their belts just like the citizens. The extravagant spending by government officials on luxury items and allowances sends the wrong message.

AJ Dagga Tolar also critiqued the current economic policies and governance, arguing that successive governments have failed to learn from past mistakes. He cited the deregulation and subsidy removal policies of the Tinubu regime as examples of neoliberal policies that have historically failed to spur industrialization or self-reliance in Nigeria. ‘These policies, dictated by the IMF and World Bank, have not only failed to develop the economy but have also exacerbated the economic struggles of the average Nigerian,’ he said. According to Tolar, the Nigerian ruling class has consistently adhered to capitalist economic philosophies that prioritize the interests of the elite over the masses. He advocates for a shift towards economic policies that focus on managing the country’s resources to benefit the majority of its citizens rather than catering to the luxurious lifestyles of a few.

The path to economic stability and improved living standards in Nigeria requires more than just nominal wage increases. As the testimonies and analyses reveal, the wage increase has failed to keep pace with the ever-rising cost of living, creating a significant gap between income and expenses. Government responses, such as palliatives, have proven largely ineffective in addressing the root causes of economic hardship. The spirit of Nigerians in navigating these challenges are commendable, however, the Nigerian government itself must implement policies that address the structural factors contributing to economic distress. Otherwise, the new minimum wage, and subsequent adjustments, will remain inadequate and the financial strain on the average Nigerian will persist⎈

*Some names in this essay have been changed to protect the identities of the sources.

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