Nigeria’s workers salary slashed by 19% as inflation rate rises to 18 year-high, 3 states worst hit

The National Bureau of Statistics(NBS) has revealed that Nigeria’s annual inflation rate rose for the seventh straight month, nearing an 18-year high of 24.08% in July 2023.

This bureau stated this in its latest inflation report released on Tuesday, August 15, 2023.

Breakdown of June inflation

The report said the inflation rose to 24.08 percent in July 2023 from 22.79 percent in the previous month and the food inflation rate quickened to 26.98 percent in July from 25.25 percent in the previous month.

Looking at the movement, the July 2023 headline inflation rate showed an increase of 1.29 percent points when compared to June 2023 headline inflation rate.

The report added: "On a year-on-year basis, the headline inflation rate was 4.44% points higher compared to the rate recorded in July 2022, which was 19.64%.

"This shows that the headline inflation rate (year -on-year basis) increased in July 2023 when compared to the same month in the preceding year (i.e., July 2022)."

Food Inflation

NBS also revealed that food inflation, an essential indicator of how Nigerian households struggle, increased in July 2023 to 26.98% from the previous month's 25.25%.

It also stated that the July 2023 inflation on a year-on-year basis, which was 4.97% points higher compared to the rate recorded in July 2022 (22.02%).

The bureau identified rising prices of Oil and fat, Bread and cereals, Fish, Potatoes, Yam and other tubers, Fruits, Meat, Vegetable, Milk, Cheese, and Eggs as the cause of increased in food inflation.

States with highest inflation rate

Kogi - 28.45%

Lagos - 27.30%

Ondo - 26.83%

Food Inflation

Kogi - 34.53%

Lagos - 32.52%

Bayelsa - 31.31%

How the new inflation rate affects Nigerians Based on the latest inflation rate figure the value of minimum wage which is N30,000 has now reduced by 19.41%.

Economists calculate workers’ real income by dividing their wages by the annual inflation rate. It is calculated as [Wages / (1 + 24.08%) = Real Income].

Using the above formula, an average Nigerian worker’s annual salary of N30,000, when adjusted for inflation us now N24,177.