Massive layoffs despite Jubilee's one million jobs per year promise

President Uhuru Kenyatta and his deputy William Ruto.
Despite the ruling Jubilee Party's promise to create a million jobs per year, the unemployment headache appears to be far from cured as more Kenyans continue to lose jobs in the massive business closures witnessed across the country. 

About 1,100 workers from Finlay Flowers are the latest victims of the unemployment misfortunes after the Kericho based firm’s shocker that it will close two flower farms by the end of the year.

In a letter dated October 18, the firm attributed its decision to the challenges facing the flower industry, explaining that the prices of roses have remained very low thanks to oversupply in the European market and decreasing demand.

As a result of this and other challenges, including a weakening exchange rate, extreme weather conditions and high labour costs, James Finlay Kenya Limited decided to close Chemirei and Tarakwet Farms earlier than initially communicated,  says the company.

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The company had notified its workers last year that it would close the two farms in December 2020 but pushed the decision to December 25, this year.

Last year, 1,800 workers from the company lost their jobs under similar circumstances.

James Finlay is not the first company to shut down part of its operation as 14,000 Kenyans have been rendered jobless after nine companies halted their operations, according to a petition filed by Kakamega Senator Cleophas Malala. 

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Recently, more than 400 Kenyans lost their jobs after betting firms SportPesa and BetIn shut down their operations citing harsh taxation by the government.

Telkom is also said to have plans to fire some of its employees after merging with Airtel.

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In October 2019, Security service provider, Securex issued a one-month notice that it will drop more than 200 workers due to what  it termed as “difficult prevailing economic times.”

In August 2019, the East African Portland Cement Company retrenched all of its staff and asked them to reapply their jobs under new terms.

According to a leaked memo, the management said that it could no longer survive the competition besides the paucity of working capital, which among other reasons, had led  to its  incurring of Sh8 million loss daily.

In July 2019, Stanbic Bank laid off 200 employees in an attempt to cut payroll costs by instituting an early retirement scheme.

In 2018, global food processor Nestle sent home more than 100 employees to cut down high operations cost. The firm said that it was revamping its sub-Saharan African operations to stay afloat.

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Under similar reasons of reorganisation, Unilever Tea sacked 11,000 employees in Kericho “to ensure that they have an organisation that is agile and fit to compete” in the changing business environment.

Once East Africa’s retailing giant Nakumatt also shed off more than 400 workers and closed virtually all its branches for reasons that were viewed as having to do with certain managerial aspects than economics.

Nakumatt had several problems that led to its slow death but tax issues and mounting debts were the major ones. According to reports, Nakumatt had accumulated an estimated debt of Sh15 billion. It, later on, signed a merger deal with Tuskys to help its revival but not much has been heard of it.

Senator Cleophas Malala argues that taxation is the main factor behind the closures and urges the government to enact economic business-friendly policies.

 “If as a country, we shall allow rampant business closures, in the not-so-distant future, we shall be pushed into astronomical borrowing. This is a dangerous path for our country,” says Malala.

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JobsUnemploymentRetrenchmentLayoffsBad Economy