Nigeria’s Minimum Wage and the Rising Cost of Living

Shefiu Muib
By Muib Shefiu 4 Min Read

Nigeria, Africa’s most populous nation, is facing a severe economic crisis. The country’s minimum wage has failed to keep pace with inflation, leaving many workers struggling to make ends meet.

The recent devaluation of the naira has further exacerbated the situation, making it difficult for Nigerians to afford necessities. This article will explore the history of Nigeria’s minimum wage, the impact of the naira devaluation, and the rising cost of living in the country.

History of Minimum Wage in Nigeria

Nigeria’s minimum wage was first introduced in 1981, with a monthly salary of ₦125 (approximately $204 at the time). Since then, the minimum wage has been reviewed three times, with the last review in 2019 setting the minimum wage at ₦30,000 (approximately $20).

However, the minimum wage has not kept pace with inflation, and the naira has been significantly devalued. Therefore, the current wage of ₦30,000 is equivalent to about $10, unlike in 1981 when ₦125 was equivalent to $204.

Naira to DollarMinimum Wage to DollarYears
₦0.62 –  $1₦125 –     $2041981
₦7.39 –   $1₦250 –     $1231989
₦85.98 – $1₦5, 500 – $472000
₦156.7 –    $1₦18, 000 – $1202011
₦360   –    $1₦30, 000 – $832019
₦1,480 –   $1Proposed (₦62,000 – $41)2024

Devaluation of the Naira

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In recent years, the naira has experienced a significant devaluation, with the exchange rate rising from ₦305 to $1 in 2020 to over ₦1,400 to $1 in 2024.

This devaluation has made imports more expensive, leading to a rise in the cost of living. The devaluation has also affected the minimum wage, making it worth significantly less than it was a few years ago and causing a sharp increase in the cost of living.

Rising Cost of Living

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The cost of living in Nigeria has risen significantly in recent years, with prices of necessities like food, housing, and healthcare increasing exponentially. The inflation rate has risen to over 26%, making it difficult for Nigerians to afford the things they need. The situation is further complicated by the devaluation of the naira, which has made imports more expensive.

Impact on Workers 

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The minimum wage in Nigeria is not enough to cover the basic needs of workers. Many workers are struggling to make ends meet, with some resorting to taking loans to supplement their income. The devaluation of the naira has reduced the purchasing power of workers, further complicating their financial situation.

Demands for a New Minimum Wage

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Workers in Nigeria are demanding a new minimum wage that reflects the current economic realities. The Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) are leading the charge, demanding a minimum wage of ₦500,000 (approximately $336). However, the government has offered ₦62,000 (approximately $41), which is significantly lower than what the workers are demanding.

Nigeria’s economic crisis is having a severe impact on workers, with the minimum wage failing to keep pace with inflation. The devaluation of the naira has further exacerbated the situation, making it difficult for Nigerians to afford necessities. There is an urgent need for the government to review the minimum wage and ensure that it reflects the current economic realities. Anything less would be a betrayal of the trust of Nigerian workers.

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