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738,000 lost jobs in worst year for Kenyan workers

WORK LIFE
By Frankline Sunday | September 10th 2021

 

Nairobi City aerial view [Boniface Okendo, Standard]

Kenyan workers suffered the worst year in 2020 as the coronavirus pandemic pushed companies to cut jobs, with many sectors recording a freeze in new hires. The economy lost 737,500 jobs in the private and public sectors even as Covid-19 disruptions saw many businesses shut their doors.

The informal sector similarly shed more than 543,000 jobs with overall employment sitting at 14.5 million as at December 2020. Self-employed and unpaid family workers in the modern sector fell from 162,700 in 2019 to 156,100 in 2020.

Data from the Kenya National Bureau of Statistics (KNBS) indicates that private sector jobs fell 10 per cent from 2 million in 2019 to 1.8 million in 2020, the lowest employment numbers recorded in the sector in over five years.

This resulted in a 3 per cent reduction in the overall share of private sector employment from 70 per cent in 2019 to 67.7 per cent in 2020. Women suffered the brunt of job losses with overall wage employment among women falling by 10.3 per cent compared to 4 per cent among men.

“Accommodation and food service activities sector was the most affected with a decline of 38.7 per cent in 2020,” stated the KNBS in the 2021 edition of the Economic Survey.

“The drastic fall in employment could mainly be attributable to public health measures instituted by the Government to contain the spread of coronavirus in the country.”

Travel restrictions

This led to the closure of entertainment businesses and eateries, forcing most establishments within the sector to lay off workers. 

“In addition, travel restrictions and the ban on night travels led to loss of business by most hotels and rooming places,’ explains KNBS. “Consequently, many businesses in the sector retrenched their workers while others closed down due to lack of business.”

Administrative and support service activities, transportation and storage and education sectors similarly recorded drastic declines in jobs at 25, 21 and 21 per cent, respectively. 

Formal manufacturing, on the other hand, saw a 10 per cent decrease to 316,900 in 2020 with the number of local employees across the country’s export processing zones (EPZ) falling by 7.7 per cent to 55,736 over the same period of time.

It was however not all doom and gloom as the construction sector reported a record 33 per cent growth in jobs from 173,300 in 2019 to 230,000 in 2020. This was attributed to ongoing construction projects in both the County and National levels of government. 

Industries in the private sector that recorded job increases include manufacturing; agriculture, forestry and fishing; wholesale and retail trade and repair of motor vehicles at 16, 15 and 13 per cent, respectively. 

Employment in the public sector, on the other hand, registered a slowed growth of 2.2 per cent in 2020 compared to a growth of 2.7 per cent in 2019. 

“Human health and social work activities recorded the highest growth of 5.8 per cent in 2020, mainly attributable to the hiring of more health workers to enhance the fight against the spread of Covid-19,” stated the KNBS. 

Similarly, arts, entertainment and recreation; education; and construction recorded growths in 2020.

Covid 19 Time Series

 

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The good, bad and ugly of a pandemic year
The size of Kenya’s economy contracted for the first time in two decades in 2020 following a tumultuous period in which the Covid-19 pandemic.
Reduced spending jolts manufacturing sector
The manufacturing sector registered a slow growth rate at 0.2 per cent in 2020 compared to 2.8 per cent in 2019.

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