The average salary in Nigeria: Detailed comparison

by Time Doctor
average salary in Nigeria

With a young and educated population, rapid infrastructural development, and low labor costs, Nigeria is becoming a popular choice for outsourcing.

Nigeria has an average monthly salary of 339,000 Nigerian Naira per month, which is nearly 774.75 US Dollars per month (as per the exchange rates in October 2022). 

Like any other country, various factors impact the salary structure in Nigeria, including educational qualifications, city, work experience, and more. 

In this article, we’ll take a closer look at the average salary in Nigeria, how it compares to other countries, and the minimum wage in the country. We’ll also discuss the four key benefits of outsourcing to Nigeria. 

Let’s jump straight in!

What is the average annual salary in Nigeria?

The average annual salary in Nigeria is 4,060,000 Naira (9338.27 USD). 

Nigeria is considered to have a lower-middle-income economy with a GDP of 45 trillion NGN (USD 102 trillion). 

A. Median salary

Wondering how the median salary differs from the average salary?

The median salary refers to the middle salary value, whereas the average salary divides the total of all salaries by the number of salaries considered.

For example, a chartered account earns 313,000 NGN, a software engineer earns 410,000 NGN, and a medical doctor makes 815,000 NGN. Here,

  • The average salary is 512,666.67 NGN (313,000 + 410,000 + 815,000 / 3)
  • The median salary is 410,000 NGN  

Interestingly, Nigeria’s median salary is the same as its average basic salary – 339,000 NGN per month (USD 774.75). 

This means that half of the Nigerian population earns less than 339,000 NGN, while the other half earns more than 339,000 NGN on a monthly basis. 

B. Salary range

Nigeria’s average salary range ranges from 85,700 NGN per month (USD 198.43), the lowest average, to 1,510,000 NGN per month (USD 3,496.24), the highest average. 

Note: The average salary range figures represent the average minimum and maximum salary. The actual maximum salary and minimum salary may differ.

Now that you know the average salary in Nigeria, you may wonder what the cost of living is for the average Nigerian worker. 

A single person’s monthly expenses, without rent, are about 196,126 NGN (USD 449.19).

C. Minimum wage

The minimum wage is the lowest remuneration an employer must pay an employee. 

For Nigerian workers, the average minimum wage currently stands at around 30,000 NGN (69.17 US Dollars) per month. 

Next, let’s look at the factors that impact salaries in Nigeria.

4 key factors that influence salaries in Nigeria

Here are the four central factors influencing an employee’s paycheck. 

1. Educational qualifications

Educational qualifications play an essential role in determining salaries around the world, including in Nigeria. According to salary explorer, here’s how salary figures vary according to the qualifications of the Nigerian workforce: 

  • Employees with a certificate or diploma earn 17% more than those who only graduated high school.
  • With a Bachelor’s Degree, an employee can receive 24% more than those who obtained a certificate or diploma.
  • A post-graduate may earn 29% more than those with a Bachelor’s Degree.
  • Ph.D. holders can make up to 23% more than those with a Master’s Degree.

Note: The changes in salary may vary according to the location or intended career. 

2. Sector and job role

In Nigeria, the average basic salary differs significantly across various sectors like finance, IT, customer care, etc. 

Salaries also vary according to specific job types (full-time, part-time, freelance, etc.) within each sector. 

The Salary Explorer report shows that some of the highest paying jobs, like dentists and doctors, belong to the healthcare sector. For example, the highest paying job goes to surgeons who receive a monthly income of 1,260,000 NGN (USD 2885.78)

Let’s take a look at the salary comparison of other jobs across the private sector in Nigeria:

Job TitleAverage Monthly Salary in Nigeria
Dentist 825,000 NGN (USD 1885.46) 
Medical Doctor 815,000 NGN (USD 1862.61)
Chief Financial Officer 689,000 NGN (USD 1574.65)
Hotel Manager 624,000 NGN (USD 1426.10)
Sales Manager599,000 NGN (USD 1368.96)
General Manager565,000 NGN (USD 1291.26)
Information Technology Manager558,000 NGN (USD 1275.26)
Human Resources Manager504,000 NGN (USD 1151.85)
Project Manager412,000 NGN (USD 941.59)
Software Engineer410,000 NGN (USD 937.02)
Petroleum Engineer346,000 NGN (USD 790.75)
Electrical Engineer 316,000 NGN (USD 722.19)
Chartered Accountant 313,000 NGN (USD 715.33)
Mechanical Engineer302,000 NGN (USD 690.19)
Pharmacist283,000 NGN (USD 646.77)

Source: salaryexplorer.com

Note: The above salaries include an allowance and other benefits received on a monthly basis.  

3. Work experience 

A salary report generated by Salary Explorer shows that an employee’s starting salary usually doubles by the time they reach the ten years experience milestone.  

Here’s a breakdown of how the average monthly income increases with work experience: 

Years of ExperienceSalary Increase (in percentage)
2-5 years32%
5-10 years36%
10-15 years21%
15-20 years14%
20+ years9%

Source: salaryexplorer.com

Note: These figures should only be used as guidelines. Salaries may differ significantly based on specific job titles. 

4. Location 

The average salary differs from city to city. This is due to factors such as the cost of living and demand for work in a specific location.

Let’s take a look at the average salaries in key locations in Nigeria:

LocationAverage Monthly Salary 
Lagos4,211,600 NGN (USD 9625.23) 
Kano4,032,100 NGN (USD 9215.00)
Ibadan3,875,100 NGN (USD 8856.19)
Kaduna3,648,200 NGN (USD 8337.63)
Benin City3,469,900 NGN (USD 7930.14)

Source: salaryexplorer.com

The above factors regarding salary data can help you plan a salary structure and compensation budget for the Nigerian workforce.

Now that we’ve examined the four factors that define the national average salary in Nigeria, let’s look at the salary increments in the country. 

The average salary increment in Nigeria

The average Nigerian worker will likely see a salary increase of approximately 8% every 19 months. 

But what determines an employee’s salary increment? 

The key factors include performance and overall contribution to the company’s success. 

However, this changes from person to person and individual company policies. 

Here’s a look at the average increment Nigerian workers can receive across different industries: 

Industry Average Annual Salary Increment 
Education8%
Travel 7%
Information Technology 6%
Banking 5%
Construction3%
Healthcare2%
Energy1%

Source: salaryexplorer.com

The average hourly wage in Nigeria 

In Nigeria, the average hourly wage (pay per hour worked) is 1,950 NGN (USD 4.47).

So how do you calculate the average wage per hour

Hourly wage = Average yearly salary / (52 x 5 x 8)

Note: The above calculation assumes that an employee worked 8 hours, 5 days a week for 52 weeks per year. 

Hourly wage calculation differs according to the hours worked per week and vacation allowance.

Average salary in Nigeria Vs. the world 

According to the World Economic Situation and Prospects (WESP) 2021 report by the United Nations, countries can be classified into three economic zones:

  • Developed economies
  • Economies in transition
  • Developing economies 

Let’s see how these countries compare to Nigeria regarding average monthly salary: 

A. Average salaries in developed countries

CountryAverage Salary Per Month Comparison to Average Salary in Nigeria (in %)
Nigeria USD 774.75N/A
Great BritainUSD 8,092 +165%
United States USD 7,900 +164%
Australia USD 4,856 +145%
NorwayUSD 4,769 +144%
Ireland USD 3,144 +121%

Source: salaryexplorer.com

B. Average salaries in economies in transition 

CountryAverage Salary Per Month Comparison to Average Salary in Nigeria (in %)
Nigeria USD 774.75N/A
Montenegro USD 2,616 +109%
GeorgiaUSD 2,415 +103%
Russia USD 1,677+74%
UkraineUSD 623 +22%
AlbaniaUSD 804 +4%

Source: salaryexplorer.com

C. Average salaries in developing countries 

Country Average Salary Per MonthComparison to Average Salary in Nigeria (in %) 
Nigeria USD 774.75N/A 
Thailand USD 2,587 +107%
South AfricaUSD 1,718 +76%
BrazilUSD 1,641 +72%
India USD 385.23+67%
The Philippines USD 758.27+2%

Source: salaryexplorer.com

5 key benefits of outsourcing to Nigeria 

Although still an emerging economy, the outsourcing sector in Nigeria has many of the required features to make it a popular Business Process Outsourcing (BPO) destination.

BPOs in Nigeria currently offer high-value inbound and outbound services to big telecoms, software, and insurance companies across Africa, the United States, the EU, and Japan.

But what makes Nigeria a desirable location for outsourcing? 

Let’s check out the five key benefits of outsourcing to Nigeria. 

1. Large, youthful talent pool

Nigeria has one of the largest youth populations in the world, with 65 million people between the ages of 10-24. 

In 2018, the World Bank reported that Nigerian youth (aged 15-24) had a literacy rate of 75%

This is much higher than other African countries like Ethiopia (73%), the Central African Republic (38%), and Liberia (55%). 

But that’s not all. 

To ensure that young Nigerians prosper, Nigeria has introduced the Nigerian Youth Employment Action Plan. 

This plan, running from 2021-2024, aims to address youth unemployment. One of the crucial aspects of this plan is addressing labor supply through skills development, training, and education. 

2. Lower labor costs

As we know, the average monthly salary in Nigeria is 339,000 NGN (USD 774.75

This is lower than the average monthly salary in developed countries like the United States, which is around USD 7,900 per month. 

To give a specific example, the monthly salary of a mechanical engineer in Nigeria is about 302,000 Nigerian Naira (USD 689.36) which is low when compared to the US (USD 7,210).

This way, investing in the Nigerian workforce can save money, which can be used for other business-related expenses like marketing, utilities, and business fees (licenses, permits, etc.) 

3. Strong broadband connection & cloud communication technology

In 2019, the Nigerian president put together a committee for the National Broadband Plan (NBP). The NBP plans to deliver data download speeds across Nigeria with adequate coverage for at least 90% of people by 2025. 

The NBP illustrates the Nigerian government’s commitment to developing the digital economy. 

That’s not all. 

According to LinkedIn, Nigeria already offers cloud-based, omnichannel solutions like Kasookoo Contact Centre. Such platforms allow organizations to offer outsourcing services remotely. 

This cutting-edge technology eliminates the need for onsite office space and other infrastructure typically needed to start a business/open an office. 

4. Ease of doing business

According to a World Bank report called The Nation, Nigerian states like Lagos and Kano have shown substantial improvement in their ease of doing business. 

This can be seen through new reforms put in place to make starting a business easy. These new reforms allow employers to: 

  • Reserve a business name in four hours.
  • Register their company within 24 hours online. 
  • Apply for and receive approval of a visa-on-arrival within two days. 
  • File and pay taxes online. 

On top of that, the Nigerian federal government has introduced several tax incentives to encourage investment in large sectors of the economy. Here are some of those benefits:

  • Tax holidays: Upon application, companies investing in specific industrial activities can receive a tax holiday for three years. 
  • Rural location incentives: Tax reductions for companies operating in rural areas (located at least 20 kilometers from running water and electricity). 
  • Gas utilization incentives: Companies in the gas industry receive a tax-free period for up to 5 years.

As a result of these efforts, Nigeria ranked 15 spots higher in 2020 than the previous year at 131 on the World Bank’s Ease of Doing Business Index

5. Number of english speakers

According to Statista, the official language of Nigeria is English, with about 60 million speakers. 

This number trumps that of BPO giant, the Philippines, which has around 36 thousand native English speakers. With a high number of English speakers, Nigerian citizens’ communication skills are a big plus for companies from English-speaking countries like the US, UK, etc. 

Wrapping up

The average salary in Nigeria is still one of the lowest compared to other countries, including the Philippines, another BPO heavyweight. 

With a large youth population, high ease of doing business, and good cloud communication infrastructure, Nigeria shows tremendous potential to become a leader in the outsourcing sector. 

You can use this guide to see if Nigeria is the best fit for your business and plan your strategy accordingly.

 
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