2 days ago
Why ₦70,000 can't buy ₦70,000 worth of goods in Nigeria
Nigeria's minimum wage has long been a topic of contention, caught between political promises, economic realities, and the everyday hardships faced by workers.
Nigeria's minimum wage increased by 133% to ₦70,000 in July 2024 following negotiations.
Economic challenges have reduced the real value of the wage from ₦30,000 to ₦55,379 by mid-2025.
Inflation impacts remain despite reported reductions due to rebased consumer price index data.
The current wage of ₦70,000 was signed into law in July 2024, following months of discussions among the government, labor organizations, and companies.
The 133% rise from the previous ₦30,000 marks one of the highest salary hikes in the country's history.
The move was designed to shield workers from the steep rise in inflation, the falling naira, and an overall deteriorating economy.
However, a new report tells a different story.
A study by Dataphyte shows that inflation has reduced the real value of Nigeria's minimum salary from ₦30,000 to ₦55,379 in less than a year.
Impact of Nigeria's inflation on its minimum wage
The dip, calculated between January and July 2025, comes despite an official claim of an 84% drop in inflation in the first half of the year, which was mostly due to a rebased consumer price index rather than a true drop in the cost of living.
The Nigerian Labour Congress (NLC) and many workers have long claimed that the ₦70,000 wage, signed into law in July 2024 after lengthy negotiations, still falls short of meeting basic living needs.
Even while the headline inflation rate fell somewhat to 21.88% in July 2025 from 22.22% in June, more than 11 percentage points lower than the 33.40% reported in July 2024, families received little comfort. Food, shelter, transportation, and other necessities remain prohibitively costly.
The July 2024 Minimum Wage (Amendment) Act was the third-largest increase in Nigeria's history and the fourth pay adjustment under separate governments.
However, like earlier upgrades, it arrived after a five-year hiatus, and its advantages were short-lived.
Historical data indicate that while wages increased from ₦18,000 to ₦30,000 in 2019, their real worth decreased to ₦15,540 by the end of 2023 and ₦11,708 by mid-2024.
In less than a year, the most recent rise is losing more than one-fifth of its value, continuing the same trend.
Economists caution that pay increases will continue to be undermined before workers can fully experience their effects unless the underlying causes of inflation are addressed and price stability is improved.
