August 22, 2025
When President Bola Ahmed Tinubu’s administration announced a ₦70,000 minimum wage in 2024, it was hailed in some quarters as a bold step. But almost immediately, critics—both local and foreign—pointed out what Nigerian workers already knew: that ₦70,000 in today’s economy buys little more than ₦18,000 did a decade ago. Even the American government, in a rare rebuke, argued that this wage cannot shield Nigerians from economic hardship, hunger, and poverty.
The heart of the matter is clear: wage increases in Nigeria are not matched by real value. Successive governments have repeatedly raised the nominal minimum wage, but the purchasing power of workers has collapsed under the weight of naira devaluation, inflation, and weak economic structures.
A Historical Perspective on Minimum Wage in Nigeria
To understand the present crisis, we must look at the past:
1981 (Shehu Shagari): The minimum wage was set at ₦125. At the time, the naira was strong—about ₦0.61 per US dollar. Workers could feed their families, pay rent, and live modestly. ₦125 then was worth over $200.
1991 (Ibrahim Babangida): Wage rose to ₦250, during the early years of Structural Adjustment Programs. The naira began to lose value, yet the increase still had meaning compared to today.
1998 (Abdulsalami Abubakar): ₦3,500 was introduced. The economy was liberalizing, inflation was rising, but many households could still survive.
2000 (Olusegun Obasanjo): ₦7,500 was announced, but many states resisted and paid as little as ₦5,500. Even then, workers could still manage basic needs without falling into absolute poverty.
2011 (Goodluck Jonathan): ₦18,000 became law. At that time, prices were not yet out of control. The wage, though modest, provided some stability.
2019 (Muhammadu Buhari): ₦30,000 was introduced, but with reluctance from states. Inflation was already eroding the benefit.
2024 (Bola Tinubu): ₦70,000. On paper, it looks like progress. In reality, with the naira at over ₦1,600 per dollar, this translates to barely $43 per month. By international standards, this leaves Nigerian workers among the world’s poorest.
The pattern is unmistakable: nominal wage growth without real wage value.
The Curse of Naira Devaluation
The central problem is not the size of the minimum wage, but the value of the naira. In 1981, ₦125 was wealth; today, ₦70,000 is near penury. This is because the naira has collapsed under repeated devaluations. Each successive administration has failed to strengthen Nigeria’s productive base, leaving the country dependent on imports and vulnerable to foreign exchange fluctuations.
Today, with exchange rates above ₦1,600 per dollar, workers’ salaries vanish before their eyes. Food, rent, transportation, and school fees have skyrocketed. A bag of rice costs over ₦80,000—more than a month’s minimum wage. The new wage, therefore, is a mirage of prosperity.
The Forgotten Majority
Even more troubling is that the minimum wage applies only to formal workers, who make up less than 10% of Nigeria’s labor force. The other 90%—traders, artisans, small farmers, vulcanizers, carpenters, okada riders, women in markets—are not covered. They must survive in an economy where prices climb daily, without any form of state protection.
Thus, while the government celebrates wage increases, the vast majority of Nigerians remain trapped in poverty. The wage debate, in this sense, is an elite distraction that ignores the realities of the masses.
Policy Failure, Not Worker Failure
What we are witnessing is not a failure of Nigerian workers, but a failure of government policy. Successive administrations have pursued import dependence, corruption-ridden subsidy regimes, capital flight, and reckless borrowing. Instead of investing in agriculture, manufacturing, and infrastructure, Nigeria has relied almost entirely on crude oil, leaving the naira exposed whenever global oil prices fluctuate.
Worse still, wage reviews are politically motivated—used as bargaining tools during elections or union strikes—rather than tied to inflation indices or cost-of-living standards. This explains why each wage increase becomes obsolete within months.
Why “Revaluing the Naira” Is Not Enough
Some argue that the solution is to “revalue the naira.” But currencies do not strengthen by government decree. A strong naira requires:
1. Diversified production—less reliance on oil, more emphasis on agriculture, manufacturing, and technology.
2. Export expansion—earning foreign exchange by producing goods the world wants.
3. Monetary and fiscal discipline—curbing inflation, borrowing responsibly, and managing public finance transparently.
4. Fighting corruption and capital flight—ensuring Nigeria’s wealth is reinvested domestically.
Until these foundations are laid, wage increases will remain hollow.
Lessons from Elsewhere
Other African countries provide examples. South Africa pegs its minimum wage to inflation and cost-of-living adjustments, ensuring wages rise with prices. Ghana uses a tiered wage system for different sectors. Nigeria, by contrast, leaves workers at the mercy of political negotiation, rather than anchoring policy on economic realities.
Conclusion: The Illusion of Wage Prosperity
The new ₦70,000 wage is not a victory—it is a symbol of Nigeria’s deeper crisis. It shows that we have not learned from history: wages without value are meaningless. Workers remain poor, the informal majority remain excluded, and the naira continues to bleed.
The way forward is clear. Nigeria must move beyond symbolic wage announcements and confront the real issue: rebuilding the economy so that the naira regains strength, inflation is tamed, and production drives prosperity. Until then, ₦70,000 is just another number—an illusion of progress in a land where poverty deepens daily.
Tags
Opinion