Concerns about the cost of living in Algeria are no longer confined to people without jobs or households officially classified as deprived. They increasingly extend to wage earners, pensioners and parts of the middle class, many of whom find that incomes once sufficient for basic needs no longer cover food, transport, clothing, medical care and utility bills.

Across the country, people describe salaries running out during the first or second week of the month. Some households postpone buying clothes, seeing a doctor or paying a bill in order to preserve their food budget. Such testimony cannot by itself measure poverty statistically, but it reflects a widely shared sense that the gap between household income and essential living costs has grown.

The problem is not simply the current pace of price increases. Earlier inflationary waves permanently raised the general price level, while the earnings of large sections of the population did not rise at the same rate.

Lower inflation does not mean prices have returned to previous levels

Official data show that inflation has eased from the levels recorded after the Covid-19 pandemic and the disruption of global markets. Algeria’s inflation rate reached about 9.3 percent in 2022 and remained around that level in 2023 before declining. The National Office of Statistics reported a more pronounced slowdown during 2025.

But lower inflation does not mean that prices have fallen back to where they were. If an item rises from 100 to 120 dinars and inflation then slows, its price is increasing more gradually; it has not necessarily returned to 100 dinars.

Macroeconomic indicators can therefore show improvement without households immediately feeling better off. Families do not live according to an abstract annual rate. They pay prices that incorporate several years of accumulated increases, particularly for food, transport, housing and healthcare.

The consumer price index is also based on an average basket, while the experience of rising prices varies considerably between households. Lower-income families spend a larger share of their resources on food and essential services and are therefore more exposed to increases in those costs than wealthier households, even when the headline inflation rate is the same for everyone.

A higher minimum wage does not settle the question of purchasing power

Since January 1, 2026, Algeria’s national guaranteed minimum wage has stood at 24,000 Algerian dinars a month, up from 20,000 dinars. The presidential decree defines that amount as compensation for a 40-hour working week, or 173.33 hours a month.

The increase is a nominal improvement, but it does not answer the central question: what can a household actually buy with that income?

Spread across 30 days, 24,000 dinars amounts to 800 dinars a day before paying for housing, water, electricity, gas, transport, healthcare, clothing or school supplies.

Even a salary above the legal minimum may be inadequate for a family dependent on a single income, especially in a major city or when rent must be paid. Households with several children, a sick relative or an elderly dependent face additional costs that cannot be captured by a simple comparison between wages and food prices.

A minimum-wage increase every few years is therefore not enough. Its purchasing power should be measured regularly against a realistic basket covering food, housing, transport, energy, health and education, with wages and benefits adjusted accordingly.

Monthly benefits do not cover every low-income household

The Algerian state provides several monthly cash transfers to specified social groups.

The unemployment allowance, intended for first-time jobseekers, was raised to 18,000 dinars a month from January 2026 and includes health coverage. Eligibility is nevertheless subject to conditions, including registration with the employment services, responding to official appointments and not refusing a suitable job offer. The revised scheme also limits the duration of payments.

Algeria also provides a flat-rate solidarity allowance ranging from 7,000 to 12,000 dinars a month, depending on the beneficiary category. It covers specified groups such as people physically unable to work, some women supporting their households, older people without income, and people whose disabilities or chronic illnesses prevent them from working.

The authorities allocated 179.4 billion dinars to this solidarity allowance, underscoring its importance within national social policy.

These programmes do not, however, amount to a universal system guaranteeing a minimum income to every household whose resources fall short of essential needs.

A household may include a low-paid worker and therefore not be classified as having no income, while still being unable to meet basic expenses. A mother or father may fail to qualify for the unemployment allowance and not belong to any category covered by the solidarity allowance, even though the family’s total income is insufficient.

Social protection is therefore still largely determined by administrative status: a first-time jobseeker, an older person without income, a person with a disability or someone unable to work. Poverty caused by inadequate household income is not always addressed through a single, coherent system.

Ramadan assistance cannot replace a regular income

Assistance distributed during Ramadan, school-related benefits and other seasonal solidarity programmes can provide important relief at particular moments. They cannot resolve a financial shortfall that persists throughout the year.

A family needs food, energy, transport and medicine in January just as it does during Ramadan. If its income remains below essential expenditure every month, an annual payment does not change the household’s structural position. It offers temporary relief before the deficit returns.

Seasonal aid responds to need during a specific occasion. A modern social-protection system should instead guarantee a regular resource that prevents households from falling below a minimum standard of living.

A more coherent approach could assess a family’s total resources, household size, children’s ages, housing circumstances and health needs. A monthly payment could then supplement income whenever it falls below a publicly defined social threshold.

Universal subsidies do not always benefit those most in need

Algeria’s social policy also relies on broad subsidies for energy, water, some staple goods, housing and public services. These mechanisms keep certain costs below what they would be in a fully liberalised market.

Universal subsidies, however, do not always distinguish between poor and wealthy households. A large home consuming substantial amounts of electricity and gas may receive more public support in absolute terms than a low-income family using much less.

Nor does a relatively low tariff mean that a bill is affordable to someone with very little income. Electricity and water may be inexpensive by international standards, but a bill of several thousand dinars remains burdensome for a household living on a 7,000-dinar allowance or a monthly wage of 24,000 dinars.

The policy choice should therefore not be reduced to retaining or abolishing every subsidy. Algeria could protect the price of a basic consumption band while directing larger cash transfers to households with limited resources and shielding them from the cost of any abrupt subsidy reform.

Poverty is not limited to having no income at all

There is a fundamental difference between a household with no income and one whose income is inadequate. A system focused exclusively on the first group risks excluding many workers, pensioners and single-income families.

A person can be legally employed and still live in poverty. A pensioner may receive a monthly payment yet be forced to choose between medicine and an electricity bill. Others work in unstable or informal activities without a regular income or full social protection.

The central question should therefore move beyond “Does this household have an income?” to the more precise question: “Is the household’s total income sufficient to meet its essential needs?”

Answering that question requires an updated national poverty threshold, regular surveys of household income and expenditure, and published data showing differences between provinces, urban and rural areas, homeowners and renters.

The absence of recent, detailed public data leaves debate over purchasing power too dependent on broad political statements and individual impressions rather than a clearly defined social measure.

Towards a minimum social income for households

Algeria could build a protection system based on the actual resources of each household rather than a collection of separate administrative categories.

A minimum social income could be paid monthly to families whose resources fall below a defined threshold. The amount would not be identical for everyone: it would vary according to household income, the number of dependants and the presence of children, people with disabilities or people living with chronic illness.

A unified national social registry could connect information from the tax authorities, social-security agencies, pension funds, employment services and housing programmes. This would help identify eligible beneficiaries, reduce false declarations and prevent improper duplication of benefits.

Digitalisation, however, should not become another barrier for older people, citizens with limited digital literacy or residents of areas where online services remain difficult to access.

The minimum wage and social benefits should also be linked to the changing cost of a basket of essential needs and reviewed regularly. That would prevent purchasing power from eroding for years before authorities introduce widely spaced increases.

Social protection cannot be reduced to seasonal assistance

Algeria already has important components of a social system: public education and healthcare, price subsidies, social housing, unemployment and solidarity allowances, pensions, school assistance and seasonal support.

Yet these elements do not always form a sufficiently coherent safety net to prevent every household from falling into poverty. A citizen may benefit from a subsidised product or a public service and still be unable to pay the rest of the month’s expenses.

The problem is therefore not a complete absence of state intervention, but the fragmentation of programmes, the low value of some benefits and the existence of poor households that do not fit the administrative categories established for assistance.

The answer cannot be limited to a larger Ramadan payment. It requires a policy that guarantees families a regular resource sufficient to protect access to food, housing, energy and healthcare throughout the year.

A household’s dignity should not depend on a seasonal operation, and a worker should not remain poor simply because the legal wage has failed to keep pace with the cost of living. The true measure of social policy is not the amount of money announced, but the number of families no longer forced to choose between an adequate meal and an overdue bill.