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Economy

Why Nigeria’s Profitable Listed Firms Are Not Lifting Household Spending, Explains Analyst

Market analyst, Olumide Adesina has argued that many profitable companies listed on the Nigerian Exchange are not paying their workers enough to boost consumer spending, even as their earnings and dividends recover strongly.

 

His post, which attracted a wide response online, did not include a data table. The core of the argument is that profits have bounced back while wage bills remain a thin slice of revenue, leaving workers with too little to spend the economy forward.

 

Published accounts offer some support, though the picture is uneven. Many large listed firms saw profits jump after the naira shock as they repriced their products in the local currency. Staff costs at some blue chips remain small compared with turnover. MTN Nigeria’s 2025 wage bill was about 1.7 per cent of revenue and Seplat’s was about 2.3 per cent, while construction firm Julius Berger was an outlier, spending more than 20 per cent of revenue on pay.

 

Those low ratios do not necessarily mean poor pay. MTN Nigeria raised its wage bill by nearly 60 per cent in 2024 to N71.7 billion, and most of its roughly 1,800 employees reportedly earn at least N1 million a month. The catch is that these workforces are small and highly skilled compared with the size of the companies.

 

Average pay at the top of the market is not the national wage, and most Nigerians work outside the exchange, in informal trade, farming, security, domestic work and government. The N70,000 monthly minimum wage and public sector arrears are a different story from a banker’s pay slip.

 

Responses to Adesina’s post split into two camps. Some want a regulator to police the ratio between pay and profit. Others point to high energy costs, foreign exchange pressures and expensive borrowing, which manufacturers say already eat into their working capital.

 

The takeaway is that raising payrolls at listed firms may not fix weak consumption if most people are not on those payrolls. A more useful test is whether real wages at companies that can afford it are rising faster than food and rent, and whether that money shows up in shops rather than only in dividend announcements.

Mubarak Bello

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