Cost of living crisis: 10 years of inflation, naira devaluation and stagnant wages crushed Nigerian households

Nigeria’s cost of living crisis has deepened sharply over the past decade as inflation, naira depreciation, fuel subsidy removal and stagnant incomes eroded household purchasing power. A new report by Comercio Partners, ‘10 Years of Money Market and Living Costs’, shows the burden has fallen hardest on the 87% of workers in the informal economy who have no minimum wage protection.

Between 2015 and 2025, headline inflation averaged above 16% annually. In 2024 alone, it hit a 28-year high of 34.8%. The naira, which traded at approximately ₦197/$ in 2015, had weakened to ₦1,500 by 2024 and averaged around ₦1,377 as of May 2026.

The wage-inflation divide

Nigeria’s minimum wage rose from ₦18,000 in 2015 to ₦70,000 in July 2024, a 133% nominal gain. Against that, cumulative inflation in the five years to December 2025 alone reached 152.7%. Every year from 2019 to 2024, the real minimum wage declined in purchasing power.

The NLC demanded ₦494,000 during the 2024 strike, nine times the negotiated settlement, as their estimate of what genuine subsistence required. The gap between what labour demanded and what was granted quantifies the distance between nominal wage policy and economic reality.

The formal wage debate, however, reaches only about 12.7% of Nigeria’s workforce. The remaining 87% of informal traders, artisans, smallholder farmers and transport operators have no wage floor at all. Their income is set entirely by market forces that moved decisively against them over this decade.

Six pressure points

The weight of inflation landed hardest on essentials, the six categories households cannot cut. Prior to the NBS CPI rebase in January 2025, food alone accounted for 51.8% of the household basket.

Rents in Lagos surged 50–200% over the 24 months leading to early 2026. The income-to-rent ratio has climbed to approximately 70%, more than double the widely accepted 30% affordability threshold recommended by the United Nations. A one-bedroom apartment in Yaba (mainland) now costs between ₦700,000 and ₦1.2 million per year, while a two-bedroom apartment in Ikeja ranges from ₦1.5 million to ₦2.5 million per year. At Nigeria’s minimum wage of ₦840,000 per year, decent housing remains mathematically unaffordable for a single earner.

Food inflation peaked at 40.87% year-on-year in June 2024, one of the highest readings for a major economy globally. Fuel subsidy removal drove up logistics costs, transmitted directly into market prices. Prices of rice, beans, cooking oil and tomatoes more than doubled in the 2023–2024 period.

Petrol stood at approximately ₦87/litre in 2015. By July 2023, the removal of subsidies pushed it from ₦195 to ₦617 overnight, a 217% jump. By April 2025, NBS recorded the national average at ₦1,239/litre. In naira terms, petrol now costs over 14 times what it did in 2015. Lagos commuters saw daily transport costs double in months.

Mobile data shifted from optional to essential for payments, remote work and commerce. In early 2025, the NCC approved a 50% tariff increase, the first since 2013. MTN attempted a 200% hike on its 15GB weekly bundle, from ₦2,000 to ₦6,000, triggering uproar before a partial reversal. The price of a gigabyte doubled from ₦287 to ₦575 between 2024 and 2025. According to data analysis by TechCabal, Nigerians now spend an estimated ₦7.62 trillion ($5.58bn) annually on mobile data.

Mid-range private school fees in Lagos range from ₦600,000 to ₦1.8 million per child per year, excluding uniforms and books. For a household earning the minimum wage of ₦840,000 annually, even one child’s tuition would absorb about 70% to 200% of total income. The naira’s depreciation has also pushed up fees at schools with dollar-linked costs.

According to the WHO, Nigeria’s out-of-pocket health spending exceeds 70% of total healthcare expenditure in many states. Inflation and naira depreciation have driven up the cost of imported pharmaceuticals and diagnostics, mostly priced in dollars. The WHO threshold for ‘catastrophic’ health spending, over 40% of disposable income after food and housing, is increasingly reached by low-income Nigerian families.

What it means for Nigerians

Chatham House analysis from March 2025 framed the outcome plainly: by early 2025, food prices were more than 80% higher than at the 2023 election, petrol had quadrupled, and poverty, already affecting over half the population, had risen further. For households, the arithmetic changed from budgeting to survival. Homeownership is delayed, emergency savings are gone, and everyday choices now involve moving to cheaper locations, deferring healthcare and cutting consumption.