A new report has revealed a grim picture of Nigeria’s business landscape in 2024, with nearly half of surveyed companies forced to reduce their workforce amid severe economic challenges.
The report by Mustard Insights, titled Nigeria’s Business Survival Report 2024: Strategies for Sustainable Business Growth Amid Economic Turbulence, the report was released on January 30, highlighting how businesses navigated a year marked by economic disruptions.
According to the report, 43.7% of Nigerian businesses reduced their workforce in 2024, a stark indicator of the country’s worsening employment situation. The report attributes these cuts to several factors, including the removal of fuel subsidies, sharp naira devaluation, and surging inflation—developments that pushed operational costs to decade-high levels.
Nigeria’s economic turmoil has deepened since the government scrapped fuel subsidies in mid-2023, causing fuel prices to skyrocket and triggering a ripple effect across all sectors.
The naira has also suffered significant devaluation following monetary policy reforms, leading to soaring import costs and reduced purchasing power for businesses and households alike. Inflation, which hit multi-decade highs, further strained the economy, eroding profit margins and driving up the cost of living.
“The economic turbulence in 2024 has been unlike any seen in recent years,” said Mustard Insights in its report, which surveyed over 100 Nigerian business leaders, including CEOs, founders, and executives. “Businesses have had to make tough decisions, including halting expansion plans, divesting, and cutting jobs just to stay afloat.”
Key Findings:
- 85.4% of businesses reported substantial cost increases due to inflation.
- 65% raised prices of goods and services to offset rising expenses.
- 46.6% failed to meet growth targets.
- 41.7% diversified offerings to survive the downturn.
The report provides a detailed analysis of business performance, comparing data from 2023 and 2024, and examining the broader impact of economic decline on revenue, direct costs, and expenditures. It also offers insights from Nigeria’s largest companies listed on the NGX-30, revealing how even major corporations struggled with revenue drops and rising operational costs.
The comparative analysis of Q3 results from 2022 to 2024 shows dramatic shifts in revenue streams and expenses among top-listed companies. Many adopted aggressive cost-cutting measures, including workforce reductions, renegotiating supplier contracts, and restructuring operations.
Despite the grim data, the report identifies survival strategies employed by resilient businesses, including diversification, strategic cost management, and digital transformation. It also provides an outlook for 2025, emphasizing the need for agile business models and proactive risk management.
As Nigeria continues to grapple with economic instability, the report serves as both a wake-up call and a roadmap for businesses seeking to navigate an increasingly volatile environment.
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