• Tuesday, June 25, 2024
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BusinessDay

Fixed-income earners most hit as cost of living worsens

How unemployed Nigerians are coping with rising cost of living

As the cost of living crisis continues to intensify in Africa’s biggest economy, workers in the country’s public sector and those on fixed income are most hit, BusinessDay findings show.

Real wages, which reflect the power of employee pay after accounting for inflation, have fallen in Nigeria by 150 percent, thus making Nigerians face increasing pressures daily and forcing them to make hard choices as prices of all products continue to rise.

“It has been tough for my family. My husband and I are primary school teachers and our cost of living has been rising daily with everything increasing in the market,” said Mariam Abubakar, a primary school teacher in Keffi, Nasarawa state.

Read also: Inflation pressure heightens Nigerian’s cost of  living

Yinka Adegoroye, a local government worker in Ogun state said the surge in prices has had a devastating impact on her.

“I lost my husband early this year and have to take care of my children with the little I earn as a local government worker,” she said.

Nigeria’s Inflation has accelerated to 24.08 percent in July, a new 17-year high, according to the National Bureau of Statistics, with it set to go even higher if the Nigerian government fails to act on soaring food prices, analysts say.

Africa’s biggest economy has been grappling with double monthly digit inflation since 2016.

The situation has accelerated poverty in Africa’s most populous country with 63 percent of Nigerians (133 million) suffering from multidimensional poverty – meaning that two in three people are poor and experience just over one-quarter of deprivation such as health, the standard of living, and work, according to a recent report by the National Bureau of Statistics.

Read also: Nigeria’s worsening cost of living puts balance diet out of reach

“Survival is the most difficult thing in Nigeria now irrespective of whether you are in the upper, middle or lower income class as there is no source of income the surging inflation is not affecting,” Benson Salami-Olayanju, chairman of Panfcm-Tech-Wise Treasure Investment said.

“But the situation is more severe with people with fixed salaries and low-income earners. Some states are still not paying the N30,000 minimum wage, so how do civil servants survive,” Salami-Olayanju asked.

The World Bank, in its latest Nigeria Development Update report for June 2023, said the loss of purchasing power from high inflation has increased poverty in the short term, pushing an estimated four million Nigerians into poverty between January – May 2023.

The global bank estimates based on the National Bureau of Statistics (NBS) data show that 89.8 million Nigerians fell below the poverty line at the start of 2023, with an additional four million making it 93.8 million in May of 2023.

Read also: Here are tips to help you handle rising living cost