Counties’ wage bill drops for first time in five years despite staff numbers rise
By John Otini, July 3, 2025County governments’ total wage payments dropped for the first time in five years despite a 2.3 per cent increase in workers to 226,000, signalling tight financing conditions at the National Treasury.
According to the 2025 Economic Survey by the Kenya National Bureau of Statistics (KNBS), total wage payments by counties dropped to Ksh193.8 billion in 2024, down from Ksh198.4 billion the previous year, marking the first annual drop in county wage spending since the advent of devolution.
“The wage bill for County Governments registered a decrease of 2.3 per cent to Ksh193.8 billion in 2024. Total wage payments in Parastatal bodies and Corporations Controlled by the Government increased by 1.9 per cent each in the same period,” the report notes.
The cutback comes amid growing concerns over unsustainable recurrent spending, ballooning public debt, and pressure from the National Treasury for counties to improve budget discipline.
From 2020 to 2023, county governments steadily increased their wage bills, driven by staff expansions in sectors such as health, agriculture, and early childhood education.
The wage bill rose from Ksh165 billion in 2020 to nearly Ksh198.4 billion in 2023.
But in 2024, that trend reversed, pointing to either pay freezes, downsizing, or delayed hiring across devolved units.
The decline comes despite population growth and increasing demands on counties to deliver health, education, water, and infrastructure services. In the absence of clear productivity gains or digitisation drives, the wage cut may suggest a pause in hiring rather than an increase in efficiency.
Interestingly, this contraction in county-level wage spending contrasts with the national government’s wage bill, which continued to rise in the same period.
According to the same KNBS data, total public sector wage payments rose to Ksh881 billion in 2024, up from Sh832 billion in 2023, with national government ministries and agencies accounting for the bulk of the increase.
The shift may also reflect implementation challenges with the Public Finance Management Act, which requires counties to keep their wage spending below 35 per cent of total revenue.
Multiple counties have previously breached this cap, attracting scrutiny from the Controller of Budget and the Auditor General.
As Kenya heads into the second half of the fiscal year, the pressure is likely to mount on governors to balance service delivery with spending discipline.