Jobseekers queue to hand in their applications at County hall on May 26, 2017. FILE PHOTO | NMG
Less than 10 percent of Kenyan adults have permanent full-time jobs, underscoring the high poverty and dependency levels in an economy where the government is struggling to tackle an acute unemployment problem.
The average share of workers in permanent full-time jobs stood at nine percent last year, says a survey part-conducted by the Central Bank of Kenya (CBK), which lists Garissa, Wajir, Turkana and Kwale as counties with the smallest proportion of quality employment.
Nairobi was ranked top on the share of permanent jobs, reflecting the capital city’s economic dominance over the other 46 devolved units created in 2013 to address the wealth imbalance, followed by Taita Taveta and Kiambu.
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The city had the highest share of permanent full-time employment, with 25.1 percent of the adults having this sort of job.
More employers are preferring to tap temporary or casual workers and this sort of employment is likely to become more prevalent, says the Federation of Kenya Employers (FKE).
The findings of the household survey by the CBK, FSD Kenya and the Kenya National Bureau of Statistics (KNBS) show that 25.2 percent of Kenyans depend on others for survival while 28.5 percent work as casuals.
About 23.3 percent are relying on agriculture for livelihoods while another 13.5 percent have opted to be self-employed amid the biting unemployment rate.
Kenya’s years of strong economic growth have created jobs, but they are mostly low-paying, informal and coming at a rate that economists say is too low to absorb the rapidly growing population.
The youth are the hardest hit by joblessness compared to their counterparts above 35 years in an economic setting that is plagued by job cuts and hiring freezes on the back of sluggish corporate earnings.
Employers lobby FKE reckons that temporary employment is taking root in corporate Kenya in the wake of recovery from Covid-19 economic hardships, which triggered mass job cuts and business closure.
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“The high rate is a reflection of the current state of the economy. Casualisation of employment has been increasing and it’s a global trend,” FKE executive director Jacqueline Mugo said.
“It [casualisation of employment] is mainly due to the unpredictable business environment, seasonal demands and rigid labour laws that have increased the pressure on employers like pay for statutory obligations like NHIF and NSSF.”
Temporary employment is usually between a week and three months without perks like pension, house perks or medical insurance and paid in cash.
While labour market regulation has been strengthening gradually across the world, several countries have deregulated since the financial crisis to try to reduce unemployment rates, making it easier for companies to hire and fire and cut workers’ pay.
The International Labour Organisation, a UN agency that specialises in work, reckons that well-targeted labour market regulations were important to protect workers from unfair treatment.
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It has urged governments to do more to extend pension coverage and unemployment benefits to “non-standard workers.”
Data from the FinAccess Household Survey, 2022 shows 28.5 percent of Kenyans are casually employed, with Marsabit and Kitui counties topping the list at 44 percent of their population followed by Machakos (40.2 percent).
The share of casual workers in wealthy counties was higher than the national average. Mombasa had 38.3 percent of adults working as casuals, Kisumu (39.5 percent), Nakuru (38.8 percent), Kiambu (32.8 percent) and Nairobi (31.1 percent).
“Casualisation will only increase in the future where firms will only retain the core staff and outsource the others,” Ms Mugo added.
Only half of global workers are paid a wage or salary, with the rest working for themselves or their family.
In Kenya, those in self-employment were highest in Kajiado with 22.6 percent of the adults running their own businesses followed by Nairobi (22.3 percent), Kilifi (21.2 percent) and Siaya (19.9 percent).
The heavy concentration of quality jobs in Nairobi indicates inequality in the country’s economic development, which has partly been attributed to the previous centralised system of government which guided sharing of resources since independence.
The devolved system of government raised hopes of addressing the economic imbalance, but analysts say there is a need to offer incentives to attract private investors to the other counties.
In 2021, the economy created the highest number of jobs in six years following the easing of measures aimed at curbing Covid-19’s spread, a boost to the more than one million young people who graduate from colleges and secondary schools.
Official data show formal jobs created last year stood at about 173,000, signalling a resumption in hiring after economic growth rebounded from Covid-19 shocks.
This marks the highest number of jobs created by companies since 2015 when the economy created 213,000 positions in the formal sector.
But the additional salaried jobs in the formal sector fell short of the 192,400 jobs, which were shed a year earlier.
Firms resorted to layoffs, pay cuts and unpaid leave policies at the height of the pandemic to stay afloat in 2020 following reduced economic activities to contain the spread of the pandemic.
This resulted in the first drop in the number of formal sector employees in 2020 for the first time since 1992.
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