Minimum wage worldwide: how did the record inflation affect those earning the least?

This is an archived report. The latest ranking is available here.

Picodi.com analysts checked how the minimum wage changed in 2023 in several dozen countries and if such a wage is enough to ensure a minimum standard of living in those countries.

Wages are catching up with inflation

The study includes 67 countries, in which the minimum wage is set by the government. Tax systems in these countries can be very different, and the difference between gross and net income can range from 0% to as much as 35% (in Nigeria – 0%). To make the comparison fair, we used net wages, which is the money employees actually take home.

In only 7 out of 67 countries included in our ranking, the minimum wage did not increase compared to January 2022. Among others, these countries are Israel, Hong Kong and Nigeria.

The highest year-to-year minimum wage increase was noted in Argentina (104.5%) and Turkey (100%). In those countries, both inflation and devaluation of currency have been exceptionally high in recent years.

Countries, which also stand out with a high minimum wage increase are Moldova (32.5% year-to-year increase), Latvia (27.1%) and Malaysia (25.8%).

In our ranking of salary increases, Nigeria ranked 60^th: currently, the minimum wage stands at ₦30,000 net monthly, which is the same as in January of last year. High pay raises can be enjoyed by those paid the least in, among others, South Africa (6.9%) and the United States (12.6%).

Basic food survival basket

For the purpose of this study, we created a contractual shopping basket and juxtaposed the price of food with the minimum wage. The basket consists of 8 groups of products: bread, milk, eggs, rice, cheese, meat, fruits and vegetables. The list is very limited, but those products in the given amounts are enough to meet the minimum nutrient requirement for an average adult.

• Milk (10 litres) – ₦60.90
• Bread (10 loaves, 500 g each) – ₦31.70
• Rice (1.5 kg) – ₦12.08
• Eggs (20 pcs) – ₦15.60
• Cheese (1 kg) – ₦26.13
• Poultry and beef (6 kg) – ₦226.26
• Fruits (6 kg) – ₦39.24
• Vegetables (8 kg) – ₦39.56

In Nigeria, the price of a basic food basket at the beginning of 2023 costs ₦48,130, which is 17.45% higher than last year. The basket is worth 160.4% of the minimum net wage, compared to last year’s 136.6% of the contemporary minimum wage. This means that the wages of those paid the least increased slower than the food prices and the minimum wage is not enough to cover even such a basic basket of products.

This is how the price of an identical shopping basket looked like in previous years:

• January 2019 – ₦31,536
• January 2020 – ₦32,420
• January 2021 – ₦35,360
• January 2022 – ₦40,980
• January 2023 – ₦48,130

Where can you live off the minimum wage?

Although food preferences and perceptions of a comfortable life vary from country to country and even from person to person, we decided to compare the prices of the same basket of food with the minimum wages to see how much of the minimum income has to be spent on products necessary to live.

The best basic food price ratio can be found, as usual, in the United Kingdom, Ireland and Australia – from 6.5% to 7.7%.

In this comparison, Nigeria is in the last (67^th) place in the ranking, with a ratio of 160.4%, being passed by countries such as South Africa (35.6%, 50^th place), the United States (12.5%, 11^th place) and the United Kingdom (6.5%, 1^st place).

In Asia-Pacific countries such as India, Indonesia, the Philippines, Thailand and Vietnam, basic food costs over half of the minimum income. In Nigeria, the minimum wage is not enough to cover even such a basic basket of products.

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Methodology and sources

In this study, we compared the monthly minimum wage for full-time work in January 2023 with wages from January 2022. These rates come from official government websites, relevant ministries or committees. We have omitted countries, in which the minimum wage is negotiated by individual trade unions and countries without a statutory minimum wage (Switzerland, Italy, Singapore and northern European countries). For countries, where the minimum wage varies from region to region (USA, Canada, Philippines, Thailand and Vietnam), we calculated and used the arithmetic mean of all regions. Net wages were obtained through salary calculators.

The set of products used in this study is a contractual basket of food products, created only for statistical purposes. The amounts given were calculated based on the recommendations of some of the health ministries regarding the minimum standards of food consumption. The product prices were taken from numbeo.com, where consumers from around the world monitor the prices of food, as well as other products and services.

For currency conversion, we used the average exchange rate data from Google Finance for the fourth quarter of 2022.

Public use

Both the infographics as well as the statistical data can be used freely for commercial and non-commercial purposes. We only ask you to credit the author of the research (Picodi.com) with a link to this subpage. In case of any questions, please feel free to contact us at: research@picodi.com.