Less than 1% of Nigerians earn above N1m as income inequality swell

Less than one percent (0.4%) of Nigerians earn above 1 million naira, according to the Nigerian Consumer Outlook Report 2025 by the SEID, revealing the depth of income inequality in Nigeria and the limited size of its upper-income class.

The report reveals that the vast majority of Nigerians earn less than ₦100,000 or have no income at all, uncovering widespread financial vulnerability.

In contrast, just 4.9 percent of respondents earn above ₦500,000, a group likely made up of business owners, high-level professionals, and individuals earning in foreign currency while living in Nigeria.

“This data paints a picture of a deeply polarised economy where a small segment controls significant financial power while the rest struggle with survival-level incomes,” the report states.

Despite an increase in Nigeria’s minimum wage to ₦70,000 as mandated by the National Minimum Wage (Amendment) Act 2024, a large portion of the population still falls below the ₦100,000 mark. The persistence of underemployment, often driven by a mismatch between labour market needs and workforce skills, remains a major barrier to income growth.

Read also: 37% of Nigerians earn below N100,000- Report 

SEID emphasises that technical and in-demand skills are increasingly becoming the differentiators for higher earnings.

“Skills have become the ultimate currency in today’s economy. Those who continuously adapt, upskill, and align with global trends unlock faster income growth, career mobility, and international opportunities,” said Nifemi Akinwamide, Head of Operations at Alt School Africa.

Income disparities are also evident across educational levels. A large proportion of unemployed individuals only have a Senior School Certificate (SSCE), while first-degree holders dominate the ₦100,001 to ₦800,000 income band. Postgraduate degree holders are more likely to earn above ₦800,000, although the report notes that many of those earning high incomes without formal education are thriving entrepreneurs, commonly referred to as traders.

Geographically, income distribution shows a sharp north-south divide. The North West and North East have the lowest share of people earning above ₦300,000, at 3.8 percent and 4.3 percent respectively.

Meanwhile, the South South leads with 19.4 percent of respondents earning above that threshold, followed by the South East (18.9 percent) and South West (15.7 percent). The South West also has the highest share of individuals earning above ₦900,000, indicating a stronger concentration of high-value jobs and business opportunities in that region.

The report further shows that self-employment (42.9 percent) slightly edges out salary or wages (41.4 percent) as Nigerians’ main income source. Other sources include investments or dividends (7.9 percent), rental income (4.4 percent), and, for some, no income at all (3.4 percent).

SEID also highlights the role of digital entrepreneurship, particularly through social media platforms, in shaping Nigeria’s earning dynamics. With 36.8 million social media users in the country as of 2024, more Nigerians are running online businesses, especially in retail, without the overhead of physical stores.

Read also: 3 apps that will keep Nigerians earning in 2025

These income disparities are playing out against the backdrop of rising inflation, further squeezing household budgets.

Nigeria’s inflation rate climbed to 24.23 percent in March 2025, up from 23.18 percent in February, according to the latest Consumer Price Index (CPI) released by the National Bureau of Statistics. The increase, the first since the recent rebasing, defied expectations of a slowdown, worsening the cost-of-living crisis for millions of low-income earners.

“Even with higher employment-to-population ratios, the reality for many is underemployment and incomes that are not keeping pace with inflation,” SEID noted.

While Nigeria recorded a 76.1 percent employment-to-population ratio in Q2 2024, 8.9 percent of respondents in the report identified as unemployed, a figure significantly higher than the 4.3 percent reported by the National Bureau of Statistics, indicating that many Nigerians are engaged in work that doesn’t provide sustainable income.