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Kenya stares at huge joblessness crisis

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Economy

Kenya stares at huge joblessness crisis


jobs

Kenya’s total workforce will increase 40.6 percent to 40.4 million by 2035, signalling a worsening youth unemployment in a setting where firms have put a freeze in hiring.

Data from the Kenya National Bureau of Statistics (KNBS) indicate the country will add 11.7 million to the job market over a period of 15 years from 2020 despite households getting fewer children.

This points to mounting unemployment in an economy that is not generating adequate jobs for school leavers and college graduates.

About 36 percent or 10.1 million of the country’s 28 million population in the workforce are out of jobs amid poverty, pointing to a growing dependency burden.

Analysts reckon that Kenya would have to rev up economic growth and diversify its economy in a bid to tackle its acute youth unemployment problem.

The lack of formal employment is a big issue. Many between 18 and 35 have no job at all despite having university degrees or other suitable qualifications.

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 in an economic setting that is plagued by job cuts and hiring freezes on the back of sluggish corporate earnings.

Of the 10.1 million Kenyans out of jobs, 2.5 million are actively looking for work while 7.6 million are inactive, which means they have either given up looking for work or do not need jobs.

The US Bureau of Labour Statistics defines the unemployed as people who do not have a job and have actively been looking for employment in the past four weeks.

Of the new wave of job seekers, Nairobi will add 914,634 by 2035, Kiambu 627, 260, Nakuru 615,976, Narok 465,764 and Kakamega 436,376, says the statistics agency.

The five counties will contribute 26 percent of the total increase, showing how they are attracting the younger population who are searching for work.

The data also reveals that the country’s population will increase by a net of 21.3 million people by 2045 to 70.2 million.

Latest data show that Kenya’s employment market is yet to recover the jobs lost at the peak of Covid-19 economic hardships

The KNBS 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.

But the additional salaried jobs in the formal sector fell short of the 192,400 jobs, which were shed a year earlier.

By contrast, more than 562,000 students are enrolled in university, worsening the plight of school leavers.

Firms resorted to layoffs, pay cuts and unpaid leave policies at 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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