The numbers may be slowing. The squeeze is not.
For a Nigerian household, the past decade has changed a basic equation: income has struggled to keep pace with the cost of simply getting by.
Rent rose. Food became harder to afford. Transport costs surged. Data moved from a convenience to a necessity. School fees and healthcare consumed larger shares of household income.
And beneath all of it sits a deeper problem: most Nigerians do not have the protection of a formal wage floor.
This is Part 4 of Comercio Partners’ 10 Years of Money Market and Living Costs report. It examines how a decade of inflation, naira depreciation, subsidy reforms and weak income growth has reshaped household finances—and why the consequences extend far beyond monthly budgets.
The Wage-Inflation Divide
Nigeria’s cost-of-living crisis was not created by one event. It accumulated.
Currency depreciation increased the naira cost of imported goods and inputs. The removal of petrol subsidies pushed up transport and distribution expenses. Food supply constraints added further pressure, while income growth failed to match the speed of price increases.
Headline inflation reached 34.8% in December 2024, according to the National Bureau of Statistics (NBS), before the CPI methodology was rebased in January 2025. The rebased series subsequently showed inflation at 24.48% for January 2025, reflecting a change in the measurement framework rather than an overnight fall in the prices households were already paying.
By December 2025, headline inflation had eased to 15.15% on the rebased series. That improvement matters. But disinflation does not mean prices have returned to where they were. It means prices are rising more slowly from an already elevated base.
The wage story tells the other half of the equation.
Nigeria’s statutory minimum wage increased from ₦18,000 in 2015 to ₦70,000 in 2024. Yet the increase in nominal pay came after years of substantial price growth, leaving workers with significantly less purchasing power than the headline wage figures suggest.
Organised labour’s position during the 2024 wage negotiations made the gap stark: the NLC pushed for a ₦494,000 monthly minimum wage, while the eventual agreement settled at ₦70,000.
But even that debate covers only part of Nigeria’s labour market.
NBS data reported for Q3 2023 showed that 12.7% of workers were in wage employment, while about 87% were self-employed and informal employment stood at 92.3%. For millions of traders, artisans, farmers and transport operators, there is no guaranteed monthly wage to negotiate upward.
Their earnings rise and fall with demand, weather, fuel prices, exchange rates and the purchasing power of their customers.
That makes inflation more than a price problem. It becomes an income problem.
Six Pressure Points
The cost squeeze is easiest to understand by looking at the things households cannot simply stop buying.
1. Housing: When Rent Becomes the Budget
Housing has moved from being a major expense to an increasingly dominant one, particularly in Lagos.
In high-demand areas, tenants have faced sharp rent increases and, in many cases, landlords require substantial advance payments. That creates a difficult cycle: households need a large lump sum to secure housing, then face higher renewal costs when the tenancy comes up again.
For a worker earning ₦70,000 a month, an annual income of ₦840,000, even a modest annual rent can consume a substantial share of total earnings before food, transport, electricity or healthcare enter the calculation.
The result is predictable:
- Families pool incomes to remain in preferred neighbourhoods.
- Workers move farther from employment centres.
- Longer commutes add another expense.
- Homeownership becomes a distant goal rather than the next financial milestone.
A cheaper apartment can become expensive once the transport bill is added.
2. Food: The Expense Nobody Can Cut to Zero
Food inflation became one of the most visible expressions of Nigeria’s cost-of-living crisis.
In 2024, food inflation climbed above 40% year-on-year, putting basic staples under intense pressure. Higher fuel and logistics costs compounded the problem, while supply constraints limited how quickly prices could respond to weaker household demand.
For families, the adjustment is rarely as simple as “spend less.”
Instead, households change what they buy:
- smaller quantities;
- cheaper substitutes;
- fewer protein-rich foods;
- fewer meals outside the home;
- more price comparisons;
- less room for unexpected expenses.
When food absorbs more of the household budget, something else usually gets squeezed.
3. Transport and Fuel: The Cost of Moving Through the Economy
Fuel subsidy removal fundamentally changed the economics of transportation.
Petrol that sold for roughly ₦87 per litre in 2015 was selling for substantially more by the middle of the following decade. After the 2023 subsidy removal, pump prices rose sharply, with the national average later reaching roughly ₦1,239 per litre in April 2025, according to NBS data cited in the report.
The effect extends well beyond motorists.
Fuel is an input into nearly every part of the economy. Higher transport costs affect commuting, food distribution, deliveries, generators and small businesses.
For an urban worker, the calculation becomes uncomfortable: earn more, spend more getting to work, then pay more for the goods transported to the market.
4. Data: From Optional Expense to Economic Infrastructure
Mobile data is no longer a luxury for many Nigerians.
It supports payments, commerce, job searches, remote work, education, customer communication and small-business operations. When data prices rise, the effect is therefore broader than a higher phone bill.
In 2025, the Nigerian Communications Commission approved a tariff increase of up to 50%, following years without a general tariff adjustment. Proposed increases by individual operators generated strong consumer backlash, underscoring how sensitive households had become to even seemingly small changes in recurring expenses.
The broader lesson is important: connectivity has become part of the cost of earning an income.
5. Education: The Price of Protecting Future Income
School fees create a different kind of pressure because parents cannot easily treat education as a temporary expense.
Private-school costs vary widely by location and institution, but fees running into hundreds of thousands of naira per child each year can place enormous pressure on a household earning near the minimum wage.
Currency depreciation adds another layer for institutions with imported inputs or dollar-linked expenses.
For parents, the choice is rarely simply whether to educate a child. It is often about which school, which location and which sacrifices are necessary to keep that education going.
6. Healthcare: The Expense That Can Destroy a Budget Overnight
Healthcare exposes the fragility of household finances most brutally.
Nigeria relies heavily on out-of-pocket health spending, leaving many families exposed when illness arrives. At the same time, imported medicines, equipment and diagnostic inputs can become more expensive when the naira weakens.
That creates a dangerous trade-off.
A family that cannot absorb a medical bill may postpone treatment, borrow money, sell an asset or divert funds from food, rent or school fees.
The financial damage of illness is therefore not limited to the hospital bill.
It can disrupt the entire household budget.
The Purchasing-Power Equation
There is an important distinction between inflation slowing and living costs becoming affordable again.
The distinction became particularly visible after Nigeria’s January 2025 CPI rebasing. The headline inflation rate shifted from the old series to a lower figure under the new methodology. But the change reflected a revised basket and weighting system; it did not erase the price increases that households had already experienced.
By early 2025, analysis from Chatham House described a country where food prices remained dramatically higher than before the 2023 election, while petrol costs had risen several-fold.
That is the central purchasing-power problem:
A slower rate of inflation does not put yesterday’s prices back on today’s shelves.
Even when the monthly or annual inflation rate improves, households continue to live with the higher price level created by previous inflation.
The Deferred Life: What Gets Pushed Into the Future?
The most revealing cost of inflation may not appear in a CPI table.
It is time.
How long does it take to save for rent?
How long to build an emergency fund?
How long before buying a home becomes realistic?
How long can a family postpone healthcare before postponement becomes dangerous?
For many households, the answer has stretched from months to years.
Rent: Saving for the Next Roof
Where landlords require one or more years of rent upfront, the entry cost of housing can become a major financial shock.
A large rent increase can force a household into a painful choice: pay more, move farther away, or share housing with relatives or other earners.
Moving may reduce rent—but increase transportation costs.
The household has not escaped the cost. It has moved it.
Homeownership: The Goal Moving Further Away
Buying a home has also become harder as construction costs rise and mortgage finance remains expensive.
The CBN’s Monetary Policy Rate was 26.5% in May 2026, after standing at 27.5% through much of 2025.
High interest rates raise the cost of borrowing, while expensive building materials increase the price floor for new housing.
For middle-income households, the dream of owning property increasingly collides with two barriers at once:
the house costs more, and financing it costs more.
Emergency Savings: The Buffer That Keeps Disappearing
Emergency savings are supposed to absorb shocks.
But when food, housing, transport and utilities consume most monthly income, there may be little left to save.
That leaves households exposed to the next unexpected expense—an illness, a job interruption, a rent increase, a damaged phone, a business loss.
Without savings, even a relatively small shock can trigger borrowing or asset sales.
How Nigerians Are Adapting
Nigerian households are not simply absorbing higher prices. They are redesigning their lives around them.
Some responses are visible:
- Moving: Families relocate to cheaper neighbourhoods, even when the move creates longer commutes.
- Cutting consumption: Households buy less, switch brands or abandon non-essential purchases.
- Delaying healthcare: Treatment is postponed when the immediate cost appears impossible to meet.
- Changing business sizes: Small businesses reduce product quantities or package sizes to preserve an affordable selling price.
- Pooling income: Extended families increasingly combine earnings to meet rent, school fees and other major obligations.
These are not lifestyle upgrades.
They are survival strategies.
And they can create secondary costs that conventional inflation statistics do not fully capture. A worker who moves farther away may pay less rent but spend more hours and money commuting. A family that delays medical treatment may save today while facing a larger bill later. A business that reduces its product size may protect its customers’ wallets while quietly eroding margins.
What the Decade Really Changed
Nigeria’s cost-of-living crisis is ultimately a story about lost financial room.
Households once had room to save after paying their essential bills. Now, for many, essentials consume most available income.
There was room to plan for a home. That horizon has moved.
There was room to absorb a medical emergency. That buffer has narrowed.
There was room to choose between brands, schools or neighbourhoods. For many families, those choices have become constrained by price.
The economy may be entering a more stable phase as inflation moderates. But stability at a higher price level is not the same thing as restored purchasing power. NBS data show the inflation rate falling substantially from the 2024 peak, while the CBN has also maintained a tight monetary stance into 2026.
That is the paradox at the heart of Nigeria’s next chapter:
Prices can rise more slowly while life remains expensive.
For households, the real recovery will not be measured only by a lower inflation rate. It will be felt when income begins to create breathing room again—when families can pay the bills, save for tomorrow and handle an unexpected expense without having to dismantle the rest of their lives.
That is the pocket impact of a decade of structural erosion.
And it is why the return of macroeconomic stability will matter most when Nigerians can finally feel it in their wallets.