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Executive Summary
- The Nigerian Living
Standards Survey (NLSS) is the official survey that is the basis for
measuring poverty and living standards. Between September of 2018 and October of 2019, the National Bureau
of Statistics (NBS) conducted the latest round of the NLSS after a decade.
It is representative at the state level[1] with a sample size of 22,110
households, focusing on increasing the understanding of living conditions
of the Nigerian population. The survey collected data on household and
individual demographics (age, gender, marital status, among others),
access to education, health and basic services, employment, assets, and
income. The survey is used to measure prevalence of poverty and to
estimate a wide range of socio-economic indicators including benchmarking
of the Sustainable Development Goals.
- Several important methodological improvements
were implemented in NLSS 2018-19 compared to the last official survey from
2009-10.
First, the NLSS was designed and collected using Computer Assisted
Personal Interviewing (CAPI) software on tablet devices. This
significantly improved quality and speed of data collection and
processing. Second, by administering a seven-day recall food consumption
module instead of a month-long diary (as done previously), the survey
improved accuracy and cost-effectiveness of collecting food expenditures
data. In addition, extra effort was made to measuring food quantities
where households used non-standard units of measurement that resulted in
better quantification of food consumption.
- These improvements in questionnaire design and
survey implementation techniques have produced an overall outcome of
high-quality data. With the support of the World Bank, the NBS
adopted best practice in the collection and processing of household data.
As is often the case, making such improvements often comes at the expense
of giving up some degree of comparability with past rounds while achieving
high standards in survey practice. Recognizing the benefits that come with
a better survey infrastructure, a deliberate decision was made to use NLSS
2018-19 as a new and improved baseline for Nigeria's living standards
survey system. One key indicator of survey quality is whether households
agree to participate in the survey. The NLSS had an impressive response
rates of over 95 percent.
Poverty Measurement
- Poverty is measured using consumption
expenditures rather than income in Nigeria-similar to the approach taken
by many other countries globally. Conceptually, consumption
expenditures as opposed to income better reflects the achievement of a
particular level of welfare (or "utility") by a household, while income
represents the opportunity of reaching a certain level of well-being.
Practically, the calculation of consumption expenditures has an advantage
of being comparatively easier to tabulate, since household income may come
from multiple sources, across different seasons, it can be difficult to
remember and track. But more importantly, households rarely report income
with an acceptable degree of accuracy, possibly because of concerns of tax
implications or privacy.
- The measurement of consumption using NLSS 2018-19
adopts a comprehensive approach to understanding monetary welfare. The "consumption aggregate" is
the monetary value of food and non-food goods and services consumed by the
household. Thus, the consumption aggregate has the following main
components: (i) expenditures on food, from all sources, including
from purchased, self-production and gifted, and meals; (ii) schooling and
education expenditures; (iii) expenditures related to health care of
household members; (iv) housing expenditures; and (v) expenditures on
other non-food goods and services, like clothing, small appliances, fuel,
recreation, household items and repairs, etc. Once all components are
calculated and added up for each household, the ensuing nominal
consumption aggregate is adjusted for household size and regional price
differences.
- In order to compare household consumption across
Nigeria, nominal prices are adjusted. Nominal expenditures are
affected by substantial price differences between regions of a country. In
addition, there are temporal price differences, whereby prices faced by
household at the beginning of the survey might differ from prices at the
end of the survey timeline (due to inflation). To ensure the comparability
of aggregate consumption across geographical areas and survey months, an
adjustment deflator is calculated and applied. The price deflator for NLSS
2018-19 was obtained by constructing a Paasche index of food unit values
where the relative prices are weighted by the budget share of the item
from the household itself. The Paasche index usually works better when
there are significant differences in relative prices faced across regions
within a country and if the hypothetical reference household is not
representative of the significant parts of the country; it allows the most
flexibility of incorporating the regional differences in the prices and
budget shares. The adjustment of nominal household consumption expenditure
aggregate by household composition and regional deflator results in real
per capita total consumption expenditure, which represents individual
welfare and thus can be used to rank individuals from the poorest to the
richest.
- The identification of the poor and calculation of
poverty rates requires establishing a poverty line. The poor are defined as those
who subsist below the poverty line, while the non-poor have consumption
expenditures higher than the poverty threshold. An "absolute" poverty line
is fixed in quantitative terms at a specific welfare level. It represents
the minimum amount of consumption below which persons are considered poor.
It also allows for measuring changes in poverty over time or across
regions can be consistently tracked. The absolute poverty line for Nigeria
was previously calculated in 2004 but has become outdated given the
structural changes in the survey instrument and household consumption
patterns.
Construction of
official poverty lines
- The official poverty line
should be interpreted as the monetary value of the food and non-food
expenditures needed for an individual to achieve a basic level of welfare. This is often referred to as
a "cost of basic needs" approach. The poverty line is anchored in the
minimum nutritional requirement of individuals and calculated in two
steps.
- The first step requires
computing the cost of the minimum nutritional basket. This minimum nutritional
requirement is expressed in terms of caloric intake derived from Nigeria's
caloric allowances table. The table below shows the daily caloric
requirements, disaggregated by sex and age groups.
Table
1: Daily recommended caloric allowances for Nigeria, by age and sex

Based
on the table of caloric allowances and Nigeria's latest demographic profile,
i.e., distribution of population by age and sex, derived directly from NLSS
2018-19, the per capita calorie requirement is calculated in two steps. First,
the caloric allowances are summed up across all individuals in different age
and sex groups, then that aggregate is divided by the total population. The
average per capita calorie allowance was calculated for Nigeria at 2251
calories per day, which serves as a nutritional reference value for food
poverty threshold in 2019.
- Next, to obtain the monetary
value of 2251 calories, the food basket of households in the second
through the fifth deciles ranked by real per capita consumption
expenditures are selected and aggregates of food
expenditures and calorie intakes for this group are calculated. Based on
the aggregates, the cost per calorie is derived, which is then multiplied
by minimum nutritional requirement of 2251 calories. Thus, the food
poverty line is estimated at 81,767 Naira per person per year.

- The second step is computing
non-food component of the poverty line. The welfare of an individual
depends not only on nutritional intake, but also on consumption of
non-food goods and services, such as clothing, housing, education and
health care. In the second stage, the food poverty line needs to be
translated into a threshold that also incorporates the expenditure
required to attain basic non-food needs. There are two ways of defining
the basic non-food needs, which produce lower and upper bounds of poverty
lines.
- The lower bound of the non-food
poverty line is defined as the average of non-food expenditures among
households whose total expenditures is close to the value of food
poverty line. Such households' non-food expenditure should be
considered as absolutely necessary for sustaining the minimum living
standards, simply because any amount of spending on non-food items for
such households necessarily reduces their food expenditure below what is
required to attain the minimum calorie requirement.
- The upper bound of the non-food
poverty line is defined as the average per-capita non-food expenditure
of households whose per capita food expenditure is close to the
food poverty line. The rationale for such an "upper bound" is that,
the average non-food expenditures among households whose food expenditure
is around the food poverty line is applicable to households that no
longer need to sacrifice food expenditures necessary to meet the
minimum calorie requirement in order to consume nonfood items. Given that
even the poor need to spend money on nonfood goods and services to sustain
minimum living standards, the upper bound is used in Nigeria to set the
non-food allowance.
- The national poverty line is
then calculated by adding food poverty line and cost of non-food basic
needs. This results in value of poverty line equal to 137,430 Naira
per person per year. The implication of this value is as follows: the
individuals living in households whose per capita annual consumption
expenditures is below 137,430 Naira are considered poor by national
standards.
Table 2: Values of food, total lower and upper levels of poverty lines
in Nigeria in 2019 (in Naira)
Annual food line | Annual lower line | Annual upper line |
81,767 | 124,948 | 137,430 |
Source: Nigeria Living Standards Survey,
2018-19. Note: The estimates exclude Borno state.
Poverty rates
- The national poverty line is
based on a welfare aggregate-regionally adjusted per capita consumption
expenditures across all households. As such, it is possible to
apply the national poverty line to the consumption aggregate to estimate
the poverty and inequality indicators across all states. Three indicators
are of particular interest and policy use: poverty headcount ratio,
poverty gap and Gini index. The headcount ratio defines the proportion of
population that is living in the households where the value of per capita
total consumption expenditure is below or equal to the poverty line.
Poverty gap measures the depth of poverty. In other words, the distinction
could be made between those who are just a little below the poverty line
and those who are significantly below the line. The poverty gap index
measures the extent to which a person falls below the poverty line as a
percentage of the poverty line. Gini index is a statistical measure of
expenditure distribution in the country. It is widely used as a measure of
economic inequality. Gini index ranges from near 0, which would indicate
perfect equality and 100 -perfect inequality.
Table
3: Poverty and inequality indicators in Nigeria in 2019
| Poverty headcount rate, in percent of population in strata | Poverty gap index, in percent of poverty line | Gini coefficient |
NIGERIA | 40.1 | 12.9 | 35.1 |
Urban | 18.0 | 4.5 | 31.9 |
Rural | 52.1 | 17.4 | 32.8 |
Source: Nigeria Living
Standards Survey, 2018-19. Note: The estimates exclude Borno
state.

- In Nigeria 40.1 percent of
total population were classified as poor. In other words, on average 4
out of 10 individuals in Nigeria has real per capita expenditures below
137,430 Naira per year. This translates to over 82.9 million Nigerians who
are considered poor by national standards. It is important to note,
that this number excludes the state of Borno. While the NLSS 2018-19
includes households from Borno, that sample was not representative of the
whole state since only households from "accessible" (safe to visit, areas
only) were interviewed. Thus, the Borno sample is considered non-random
and non-representative.

Table 9 Quintiles - Nominal Consumption Aggregate
|
|
Table 10 Quintiles - Spatially and Temporally Deflated Consumption
Aggregate
|
|
|
Average consumption of ……
|
|
|
Quintile
|
Mean
|
|
Quintile
|
Mean
|
1
|
65,690
|
Fifth 20%
|
1
|
70,918
|
2
|
108,730
|
Fourth 20%
|
2
|
115,642
|
3
|
154,290
|
Third 20%
|
3
|
161,735
|
4
|
219,195
|
Second 20%
|
4
|
226,436
|
5
|
415,254
|
Top 20%
|
5
|
422,977
|
- Given
that NLSS 2018-19 is not technically comparable to either the NLSS 2003-04
and to HNLSS 2009-10, it is not possible to compare poverty levels between
2003-04, 2009-10 and 2018-19. In order to compare poverty
rates across time, the underlying data should be collected in a similar
method. The way the data is collected has great effect on the values
reported by households. For example, empirical studies find that mean and
variation of reported consumption might be higher in surveys that
collected data using pen-and-paper interviewing (PAPI)-the way the data
was collected in 2003-04 and 2009-10 as compared to CAPI-the mode used in
2018-19. That difference is amplified by modification in the survey
instrument, i.e., transition from a month-long diary of measuring food
consumption (administered back in 2003-04/2009-10) to 7-day recall
(implemented in 2018-19). The innovations of NLSS 2018-19, while
introducing accuracy and cost-effectiveness of the survey also rendered
the incomparability of data and statistics derived from NLSS 2009-10,
including the poverty levels. The 2019 study is accordingly treated as
a base study and any comparisons with previous poverty studies should be
treated with caution.
Table
4: Poverty and inequality indices by states
State
|
Poverty headcount rate, in percent of population in strata
|
Poverty gap index, in percent of poverty line
|
Gini coefficient
|
Abia
|
30.67
|
7.15
|
24.48
|
Adamawa
|
75.41
|
27.64
|
27.78
|
Akwa
Ibom
|
26.82
|
7.25
|
31.78
|
Anambra
|
14.78
|
3.24
|
24.99
|
Bauchi
|
61.53
|
20.50
|
26.51
|
Bayelsa
|
22.61
|
5.25
|
29.69
|
Benue
|
32.90
|
8.43
|
29.43
|
Borno*
|
|
|
|
Cross
River
|
36.29
|
9.66
|
30.68
|
Delta
|
6.02
|
0.94
|
29.84
|
Ebonyi
|
79.76
|
34.09
|
28.60
|
Edo
|
11.99
|
2.90
|
29.52
|
Ekiti
|
28.04
|
6.16
|
29.70
|
Enugu
|
58.13
|
16.00
|
24.99
|
Gombe
|
62.31
|
20.03
|
31.54
|
Imo
|
28.86
|
6.89
|
27.24
|
Jigawa
|
87.02
|
38.73
|
28.00
|
Kaduna
|
43.48
|
15.51
|
35.19
|
Kano
|
55.08
|
15.24
|
28.64
|
Katsina
|
56.42
|
16.18
|
24.57
|
Kebbi
|
50.17
|
15.14
|
29.55
|
Kogi
|
28.51
|
6.19
|
24.42
|
Kwara
|
20.35
|
4.45
|
25.06
|
Lagos
|
4.50
|
0.67
|
27.23
|
Nasarawa
|
57.30
|
16.87
|
25.57
|
Niger
|
66.11
|
21.68
|
27.59
|
Ogun
|
9.32
|
1.63
|
27.10
|
Ondo
|
12.52
|
2.28
|
25.54
|
Osun
|
8.52
|
1.43
|
25.12
|
Oyo
|
9.83
|
1.85
|
31.09
|
Plateau
|
55.05
|
17.80
|
40.22
|
Rivers
|
23.91
|
5.46
|
29.47
|
Sokoto
|
87.73
|
38.82
|
28.02
|
Taraba
|
87.72
|
42.38
|
32.23
|
Yobe
|
72.34
|
26.48
|
27.31
|
Zamfara
|
73.98
|
24.95
|
23.49
|
FCT
|
38.66
|
9.77
|
32.26
|
Source:
Nigeria Living Standards Survey, 2018-19.
Note: * The estimates exclude Borno state.
Table 5 Poverty Headcount Rate by Household Head's Education Level and
Sex
|
|
|
State
|
No education/ less than primary education
|
Primary education
|
Secondary education
|
Post-secondary education
|
|
|
Male
|
Female
|
Male
|
Female
|
Male
|
Female
|
Male
|
Female
|
|
|
NIGERIA
|
66.17
|
34.72
|
41.25
|
26.93
|
25.00
|
14.08
|
18.13
|
5.66
|
|
|
Urban
|
43.14
|
24.66
|
19.16
|
19.35
|
12.97
|
11.20
|
8.86
|
3.42
|
|
|
Rural
|
70.82
|
39.17
|
50.33
|
32.74
|
35.87
|
18.96
|
31.20
|
10.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 6 Poverty Headcount Rate by Household Head's Income-generating
Activity and Sex
|
State
|
Agriculture only
|
Nonfarm enterprise only
|
Wage work only
|
Diversified
|
Apprenticeship/ Not working
|
Male
|
Female
|
Male
|
Female
|
Male
|
Female
|
Male
|
Female
|
Male
|
Female
|
NIGERIA
|
58.76
|
37.75
|
25.45
|
19.45
|
17.53
|
13.99
|
46.90
|
31.54
|
34.24
|
24.13
|
Urban
|
30.11
|
27.96
|
15.22
|
18.12
|
11.87
|
11.38
|
23.92
|
24.99
|
18.60
|
11.00
|
Rural
|
63.20
|
39.02
|
41.68
|
22.48
|
28.72
|
21.14
|
53.25
|
33.79
|
47.14
|
34.81
|
|
|
|
|
|
|
|
|
|
|
|
Table 7 Poverty Headcount Rate by Household Size
|
|
|
|
|
|
State
|
1 person
|
2-4 people
|
5-9 people
|
10-19 people
|
20 or more people
|
|
|
|
|
|
NIGERIA
|
2.66
|
17.88
|
40.90
|
67.27
|
77.66
|
|
|
|
|
|
Urban
|
1.66
|
5.23
|
19.07
|
44.47
|
71.57
|
|
|
|
|
|
Rural
|
3.61
|
27.52
|
53.18
|
73.79
|
79.60
|
|
|
|
|
|
Top category (20 or more people) is too small - just 17 observations
for urban areas
|
|
|
Click Here to Download 2019
Poverty and Inequality in Nigeria PDF Report

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