The cost of living in Nigeria continues to soar, with many individuals facing mounting financial pressures due to the combined effects of inflation and currency devaluation. Ifeanyi Caleb, a 35-year-old analyst at a finance firm, shared his frustration over the skyrocketing prices of everyday items. Caleb recently purchased a wristwatch for N12,000, a significant jump from the N4,500 price tag just one year earlier. The sharp increase is largely attributed to Nigeria’s ongoing foreign exchange crisis, which has made imported goods more expensive.
“It is very expensive to buy imported or even local items,” Caleb said. He added that the high cost of transportation, which now consumes nearly 49% of his salary, further exacerbates his financial struggles.
Similarly, Mariam Adetayo, a mother of three, expressed concern over her dwindling disposable income. “Prices have doubled or tripled, but my salary hasn’t increased in years. Feeding my family now costs almost everything I earn,” she said, highlighting the growing challenge many Nigerians face as inflation continues to erode their purchasing power.
The latest Duplo 2024 Salary Report paints a grim picture of the nation’s economic landscape, revealing that 90.7% of Nigerians believe that fluctuations in exchange rates and inflation have negatively affected their earnings. Among finance professionals, 91.6% reported feeling the pinch of rising prices, with only a small fraction satisfied with their current compensation packages.
Inflation has reached alarming levels, with Nigeria’s rate rising to 33.88% in October 2024, up from 32.70% in September. This spike is largely driven by high petrol prices and rising transportation costs. Analysts warn that inflationary pressures, combined with the depreciation of the naira, are expected to persist, further squeezing household budgets.
In response to the economic crisis, some companies, like GTBank, have raised salaries to help employees cope with the rising cost of living. In September 2024, GTBank increased staff salaries by 40%. Similarly, the salary bill for Nigeria’s listed banks surged by 91% in the first nine months of 2024, as businesses scramble to retain employees amid the cost-of-living crisis.
Despite these efforts, many Nigerians are still struggling to make ends meet, with some spending more than half of their income just to cover basic food expenses. According to Taiwo Oyedele, chairman of the Presidential Fiscal Policy and Tax Reforms Committee, the high burden of taxes further compounds the challenges faced by Nigerians, particularly those in lower income brackets.
As inflation continues to erode the value of wages, experts argue that companies must prioritize inflation-adjusted compensation packages and offer innovative benefits, such as flexible work arrangements and performance-based incentives, to retain top talent. Yele Oyekola, CEO of Duplo, emphasized the importance of transparent compensation strategies to mitigate the economic pressures faced by employees.
The ongoing economic turmoil has left many Nigerians questioning how long they can sustain their livelihoods amidst rising costs, suggesting that more structural reforms may be needed to address the root causes of the crisis.
