Understanding the average income in Nigeria requires a comprehensive look at various economic factors, including wages, employment rates, and the overall economic landscape. This article delves into the average income statistics in Nigeria, comparing them with other countries and exploring the factors that influence these figures.
A person's income is the sum of all money earned. The average income of a country is calculated from the gross national product and the number of inhabitants. Dividing all earnings and profits of all inhabitants (= gross national income) by the number of inhabitants gives the average income per person. This includes all wages and salaries, but also other income, e.g. from capital gains.
At first glance, that may sound somewhat inaccurate in a country comparison, as companies also generate an income. Regardless of size, the company is also owned by individuals. Therefore, the income of the owners increases to the same extent as the income of their companies.
Average Salary in Nigeria | How Much Do People Earn in Nigeria?
Understanding the Difference Between Wage and Income
It's crucial to differentiate between wage and income. The wage or salary is paid to a worker or employee for his work in an employment relationship. Self-employed persons, freelancers, pensioners, or social welfare recipients have neither wage nor salary but nevertheless an income.
Workers or employees can also have additional income to their wages or salary. This includes, for example, capital gains (e.g., securities or interest) or rentals. A person's income is, therefore, the sum of all money earned.
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Salary, on the other hand, is something quite different and can only be compared internationally in a few cases. It only includes those who also receive a salary (or wage) and ignores large parts of the money earned. Moreover, what is covered by this salary varies from country to country.
Challenges in Determining Average Salaries
Another difficulty in the statistics is already the determination of salaries. In countries where social insurance does not exist, the state has hardly any possibilities for a reasonably accurate count. Of course, any state could simply count its taxpayers. But what reason does an employer have to report his employees at all? Once there is no social security, there is almost no incentive to do so.
In the particularly poor countries, there is also the fact that they cannot afford the luxury of a governmental - and thus taxpayer-funded - statistical authority. Apart from a few unrepresentative survey results, there are often no reliable figures. This is also the reason why no average salary is given for numerous countries. Even determining an average value that is comparable across countries is therefore complex to impossible. The specification of a median value, which is often desired here, is then already pure utopia.
Official data is published by several organizations like the World Bank, International Monetary Fund or the OECD on a regular basis. Unfortunately, there are no standardized procedures to adjust for inflation, currency fluctuations or real purchasing power. That's why each institution has its own ranking and varying results.
The income is therefore calculated according to the Atlas method from the quotient of the gross national income and the population of the country. The OECD and the UNECE calculate gross wages annually in the respective national currency. For better comparison, we have converted this national currency into US dollar using the annual average exchange rate. For all figures, we take the latest official numbers, which are usually those of the previous year. For the vast majority of countries, the above table is based on information from 2024. In some countries, however, these starting figures are not collected regularly or published and may therefore be older or official estimates by the above-mentioned institutions.
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National income is always attributed to the domestic population. These are people who live predominantly in the respective country. They do not necessarily have to have the same citizenship, habitual residence is sufficient. Also included in the gross national income are any earnings generated by these residents in another country. If a Mexican worker earns their money in the US during the day, but lives in Mexico, their income is counted for Mexico. If they actually live in the US for at least six months a year, they become a fiscal resident in the USA and their income is counted there.
Average Monthly Income in Nigeria
The average monthly salary in Nigeria is 339,000 Nigerian Naira (NGN), about USD 220. Wages in the country are low due to recession and economic instability, volatile oil dependence, and currency devaluation. The median monthly income in Nigeria is the same as the average salary, 339,000 NGN.
However, you must also consider how salaries are affected by experience, education, location, position, and industry. Education plays a significant role in Nigeria’s wage determination. Location also affects salaries as urban workers earn more than rural workers due to higher living costs and proximity to large companies offering more job opportunities.
The minimum wage in Nigeria is 70,000 NGN (about $45 Nigeria minimum wage USD) per month. The last increase took effect in July 2024.
A new report by Nigerian HR startup PaidHR (formerly PadeHCM) has revealed that 78% of workers in Lagos, Nigeria’s largest city, earn less than ₦100,000 ($62.50) per month. According to the report, only 7% of workers in Lagos earn above ₦200,000 ($125) monthly, with the median salary sitting at ₦60,000 ($37.50). On average, workers spend ₦58,000 ($36.25) on food, ₦15,000 ($9.30) on housing, and ₦22,000 ($13.75) on transportation each month, leaving little room for savings or discretionary spending.
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The report also noted that most workers allocate 20% of their income to “black tax”, or financial support for extended family members. The report also found significant gender disparities in earnings. Men earn a median salary of ₦70,000 ($43.75), while women earn ₦50,000 ($31.25). Economic pressures are also impacting worker productivity.
The report noted that 55% of workers reported a decline in productivity over the past year, citing Nigeria’s economic challenges as a primary factor. While employers attributed this drop to rising transportation and feeding costs, 58% of respondents believe their mental and emotional state is the primary factor affecting their work performance.
Despite the challenges, Lagos’ workforce is young and vibrant, with 51% of respondents aged between 19 and 35. Commenting on the findings, Nigerian analyst Moses Adeolubodun tells FORBES AFRICA, “The economic landscape in Lagos reflects a microcosm of the larger Nigerian economy, where inflation and economic instability have left the average worker in a precarious position.
The survey results shed light on the average monthly income of respondents from four different countries: Ghana, Kenya, Nigeria, and Uganda. The data reveals stark income disparities, with a significant percentage of people earning below the reported average in each country. This analysis dives deeper into the numbers to provide a clearer understanding of the financial landscape in these regions
Respondents in Nigeria reported an average monthly income of NGN 368,629.88 (around USD 470), but like the other countries surveyed, a substantial 74.15% of respondents earn below this amount. This means that nearly three-quarters of the Nigerian respondents fall short of the reported average income, while 25.85% earn at or above the average.
The data shows that while the average income of NGN 368,629.88 may appear substantial compared to the other countries, it doesn't reflect the earnings of most Nigerians. The fact that over 74% of respondents earn less than this indicates that for the majority, day-to-day expenses take up a large proportion of their income, leaving little room for savings or investment.
In Kenya, the survey data shows that the average income of respondents is KES 47,231.54 (approximately USD 321). However, much like Ghana, the majority of Kenyans surveyed (about 86.07%) earn below this average monthly income. Only 13.93% of respondents earn at or above this figure, which further underscores the income disparity in Kenya.
These figures highlight that the average monthly income is not reflective of the broader population. The overwhelming majority, 86%, earn below this benchmark, painting a picture of financial struggle for many households. Despite this, the 13.93% of respondents earning at or above the average are likely in a better financial position, allowing for greater financial security and savings potential.
In Uganda, the survey found that the average monthly income is UGX 652,975.51 (about USD 174). Of the Ugandan respondents, 71.43% earn below this figure, meaning that only 26.53% of the population earn at or above the average income.
Similar to the trends observed in the other countries, the average monthly income does not fully represent the reality for most Ugandans. More than 7 out of 10 people earn less than the reported average, which suggests that a significant portion of the population faces financial challenges in trying to meet basic needs.
Based on the survey, the average monthly income of respondents in Ghana is GHS 4,529.44 (approximately USD 287.62). However, this figure does not fully represent the financial situation of the majority of Ghanaians, as 89.84% of respondents reported earning below this amount. This means that nearly 9 out of 10 Ghanaians in the survey earn less than the reported average, indicating a high concentration of lower-income earners.
Comparison of Average Salaries: Nigeria vs. Other Countries
To provide a clearer perspective, let's compare the average salary in Nigeria with that of other countries:
| Country | Average Salary (USD) | Comparison to Average Nigeria Salary |
|---|---|---|
| United Kingdom | $3,116 | -1,300% |
| United States | $5,677 | -2,500% |
| Norway | $4,700 | -2,036% |
| Germany | $4,467 | -1,945% |
| Austria | $3,628 | -1,550% |
| Romania | $835 | -281% |
| Russia | $700 | -218% |
| Albania | $1,550 | -604% |
| Kazakhstan | $645 | -195% |
| Ukraine | $450 | -105% |
| Thailand | $2,772 | -1,172% |
| Philippines | $875 | -300% |
| Vietnam | $360 | -63% |
| Egypt | $263 | -18% |
| Pakistan | $250 | -14% |
The data clearly indicates that average salaries in many developed countries are significantly higher than in Nigeria. This disparity reflects the economic challenges and developmental stage of Nigeria.
Nigeria as an Outsourcing Destination
Nigeria is emerging as an attractive outsourcing destination due to its cost-effective labor, growing tech ecosystem, and favorable time zone. Despite being Africa’s largest economy, it is limited in human development, infrastructure, and government. Although it has abundant natural resources, it faces challenges in translating them into generating income.
Although the country faces internal issues, it offers great promise as an outsourcing destination. Nigeria’s IT industry has grown significantly in the past few years, especially in e-commerce and fintech. Lagos is emerging as a prominent tech hub, attracting investments and startups.
Petroleum is Nigeria’s most important industry. It is one of the top ten global oil producers, and crude and petroleum products are some of the country’s biggest exports. They generate about 14% of the country’s GDP and account for approximately 83% of the government’s revenue.
Agriculture is another significant industry in the Nigerian economy, accounting for around 18% of the country’s GDP. It produces about 8 million tons of oil palms annually for cosmetics, bioenergy, plastics, and other industries.
Nigeria’s vast resources, low-cost labor, and strategic location make it a promising outsourcing destination.
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