Saudi-led coalition's Yemen war hollows out economy: wages can't keep up with food, currency split by standoff

According to Al Jazeera, the Saudi-led coalition's war in Yemen has entered its eleventh year, with World Bank data showing that the country's per capita real GDP has fallen about 58% since 2015. The war has left persistent cracks not only in casualties on the front lines, but also in wages, food prices and the monetary system — World Food Programme monitoring in early October 2026 shows that, in "accessible" areas of government-controlled territory, 74% of households are unable to meet basic food needs.

In the government's interim capital Aden, shelves are not empty — prices are the real threshold. According to Al Jazeera, government employee Bushra Abdullah Abdulwarith earns a monthly salary of 78,000 Yemeni rials, equivalent to only about $50 at the black-market exchange rate; the "Yemen Economic Tracking Initiative" estimates that an ordinary household in government-controlled areas spends around 130,000 Yemeni rials (about $83) per month on food alone, with rent, transport and medical care not yet counted.

Al Jazeera's report noted that Ayman al-Maqtari, who works at a shopping centre in Aden's Mansoura district, told the network that customers now rarely buy non-essentials, and rice purchases have shifted from 40-kilogram sacks to 5-kilogram bags. "Many people are already living day by day, even week by week," he said, adding that once funds run out early in the month they can only rely on credit.

In May 2026, the Yemeni government approved a 20% cost-of-living allowance for public-sector employees, in an attempt to ease inflationary pressure. But according to Al Jazeera, the allowance is calculated on the basis of base salary, meaning the actual increase is limited. Bushra described it as "a temporary painkiller that does not reflect the actual scale of pressure people are living under."

In government-controlled Marib — an eastern city sheltering hundreds of thousands of displaced people — government employee Abu Mohammed Nasser al-Asbahi earns a monthly salary of 400,000 rials (about $250), more than half of which goes to rent. "The salary doesn't even last the first third of the month before it's spent," he told Al Jazeera, adding that the remaining days are sustained by credit and loans from local shops. Also in Marib, government agency worker Salah al-Zuhaifi said: "No matter how much you earn, you cannot meet your needs."

Al Jazeera reported that Khaled Mohsen, who works at a pharmacy in Marib, said rising drug prices have forced many patients to drop parts of their prescriptions and buy only "the most essential" portions; chronic patients in general have begun cutting their doses to stretch their supply.

According to Al Jazeera, Yemen's monetary institutions have split into two systems since the Houthi armed group (also known as "Supporters of God") seized the capital Sanaa in 2014 — one side aligned with the government, the other with the Houthis. The Houthi side has banned newer versions of government banknotes and enforces a largely fixed exchange rate. But Al Jazeera noted that the stable exchange rate has not translated into greater purchasing power: markets are plagued by cash shortages and by the additional costs of transferring funds between the two currencies and banking systems, directly hitting ordinary families who depend on remittances from inside and outside the country.

In Sanaa and other northwestern areas under Houthi control, Al Jazeera's report stressed that public-sector employees often have not received full salaries for years, with some sectors receiving limited or half salaries at irregular intervals; private-sector workers face shrinking economic activity, multiple taxes and a shortage of job opportunities, eroding both income and job stability.

WFP monitoring covers only "accessible" areas of government-controlled territory, with no comparable data of the same kind available for Houthi-controlled areas; the sustainability and funding source of the 20% cost-of-living allowance, as well as the actual scale of obstacles to cross-border fund flows behind the stable exchange rate in Houthi-controlled areas, remain difficult to quantify.