Sanaa, Aden and Marib, Yemen – As fighting intensifies across Yemen between the government and the Houthis, millions of people are confronting another battle far from the front lines: the deteriorating living and economic conditions in the country. With salaries for large segments of the workforce either unpaid or irregularly disbursed, and the prices of goods and services rising, Yemen’s economic struggles have been compounded by a divided banking system that has made moving money between different parts of the country increasingly complicated.
From Aden’s struggling shoppers to displaced families in Marib and unpaid public-sector workers in Sanaa, Yemenis are being forced to make difficult choices about what they can afford and what they must go without. In Aden, the internationally recognised government’s interim capital in the south, the problem is not a shortage of goods in markets, but rather people’s inability to afford them. Salaries have failed to keep pace with the rising costs of food, rent, healthcare, and transport, leaving workers with little money left over at the end of the month.
The consequences are visible in the smaller quantities and cheaper products that now fill shoppers' baskets, as well as the difficult decisions families must make about what to eliminate. One government employee in Aden earns 78,000 Yemeni riyals, roughly $50, per month at the black market exchange rate, while typical household food costs in government-held areas run about 130,366 riyals, or about $83, according to estimates by the Yemen Economic Tracking Initiative. That financial gap exists before factoring in rent, transport, healthcare, and other household necessities.
The economic hardships facing local residents illustrate how more than a decade of war has devastated the national economy. According to the World Bank, real gross domestic product per capita has fallen by approximately 58 percent since 2015. The fragmentation of Yemen's monetary institutions between the government and the Houthis, who have operated separate institutions since seizing the capital of Sanaa in 2014, along with halted oil exports and declining international assistance, have all severely contributed to the ongoing economic decline.
Rising prices have forced numerous households to abandon non-essential purchases and cut back on expensive staples, particularly meat. Other families have resorted to buying food in smaller amounts, sometimes relying on credit or loans. Retailers report a notable decline in purchasing power, noting that customers rarely buy non-financial extras and instead carefully weigh the price of essentials like rice, sugar, flour, and cooking oil before making a purchase.
To help alleviate mounting pressures, the Yemeni government approved a 20 percent cost-of-living allowance in May for public-sector employees. However, because the amount is calculated from base salaries rather than total pay, the actual increase remains minimal for many workers, leading many to describe the measure as a temporary relief that fails to match the reality of living standards. Monitoring data from the World Food Programme highlights the severity of the situation, showing that a vast majority of households in accessible government-controlled areas struggle to meet their basic food needs.
The crisis is equally acute in Marib, a government-controlled city east of Sanaa that hosts hundreds of thousands of displaced individuals. Population growth over the course of the conflict has heavily strained local housing, employment, and public services. Government workers in Marib find their earnings depleted within days of receipt, daily labourers struggle to secure consistent work, and displaced families are left making impossible choices between basic needs such as purchasing water or milk as inflation continues to erode purchasing power across the country.