The public sector is facing a reality check as its ageing workforce exits without passing on critical skills to younger workers, exposing the sector to disruptions.
Many public sector institutions have a skills transfer policy, but many ministries, departments and State-owned enterprises have struggled to implement it.
And now the ageing workforce is exposing the public sector to possible loss of key skill sets - a scenario that is forcing some entities to hold onto retiring employees longer.
Kenya Power, for instance, revealed recently that the average age for its employees is 46 years - a scenario the company says poses a major “crisis in the next 10 years.”
The firm, which is proposing to cut a fifth of its workforce by June 2023, said it requires a human capital-focused business sustainability plan to ensure that key skills and talent are transferred to younger workers.
But this cannot be achieved overnight. For many organisations, it takes years. It is against this backdrop that Kenya Power says it may still reach out to those laid off for help.
“The exiting staff will form a rich database of experienced experts that the company will call upon as resource persons or contractors when the need arises,” said Kenya Power.
Kenya in 2009 changed the retirement age for civil servants from 55 to 60 years, but this has done little to end the ageing workforce crisis. The ageing workforce crisis spreads beyond Kenya Power and is reflected in the growing burden of pension.
The Nairobi City County, for instance, is grappling with an ageing workforce after several failed attempts to rejuvenate the old workforce inherited from the Nairobi City Council.
The problem was identified about eight years ago but not much has been achieved in hiring a younger workforce. Nairobi City County Public Service Board chairperson Thomas Kasoa warned that without a policy on human resource succession plan, the problem will only get worse.
This was after an audit showed about three-quarters of City Hall workers were more than 50 years. “The last recruitment was done almost 20 years ago. Those people are now over 45 years old and if we don’t have a succession plan in terms of human resource, then the county government will soon grind to a halt,” Mr Kasoa was quoted as saying last September.
The Public Service Commission (PSC) in 2017 drew a succession planning management strategy seeking to address challenges such as an ageing workforce and skills flight and brain drain, particularly in the professional and technical areas. The main objective of the strategy was to initiate a proactive planning process by developing a pool of potential successors and encouraging a culture that supports knowledge transfer and employee development.
But not much has been realised from this, with many State entities still depending on an ageing workforce for critical duties. Even PSC itself is grappling with an ageing workforce.
By the end of June last year, PSC data showed 43 per cent of its 231 employees were aged 50 years and above.
Another 40 per cent were aged between 40 and 49 years, leaving PSC with only 17 per cent of workers aged below 40 years. Only two workers were aged below 30 years at the time.
“Cognizant of this fact and its significance for succession management, the commission has embarked on a restructuring programme to address the gaps,” said the commission.
The PSC said it has over the years experienced succession management challenges partly due to the stagnation of its officers in one pay grade for long periods. An April 2016 audit showed that 35 per cent of the employees in national government were aged between 51 and 60 years, while 52 per cent were above 46 years.
A previous human resource audit conducted in the national and county governments in 2014-15, revealed that 31 per cent of staff were aged between 50 and 59 years, while 30 per cent were in the age bracket of 40 to 49 years.
The audit further revealed that 40 per cent of staff in several ministries and state departments were aged 50 years and above.
But the continued lack of effective human resource planning and recruitment practices has made it difficult for the State to optimally deliver services.
PSC has been forced to retain some of the workers beyond the mandatory retirement age to provide more time to mentor successors or recruit replacements. This even as the pension bill rises. Treasury, for instance, expects to spend Sh146 billion on pensions in the financial year starting June 2022.
The planned spending is five times higher than the Sh27.7 billion that taxpayers paid eight years ago, pointing to the rising burden to sustain the public workforce in its sunset years.
Treasury’s pension department is currently servicing dues of about 300,000 pensioners, with new claims hitting 20,000 annually.
In three years to June 2020, nearly 60,000 public servants retired. Some 20,300 exited in the year ended June 2020 compared to 19,800 and 19,300 in 2018-19 and 2017-18 respectively.
With such mass exits happening, the public service is struggling to retain skills sets required for critical areas.