Listen to This Article Enhance your reading experience by listening to this article.

The World Bank has painted a stark picture for Kenya’s labour market in 2024, forecasting an escalation in unemployment due to ongoing economic challenges.

In a report, the bank attributes this anticipated increase in joblessness to several factors, including sluggish economic growth, persistently high infla-tion, and policy uncertainty, compounded by global economic headwinds.

These challenges have been exacerbated by shifts in the education system, which have directly impacted over 500,000 non-teaching staff in second-ary schools.

The staff, including lab technicians, cleaners, cooks, and secretaries, lost their jobs due to the transition to the Competency-Based Curriculum (CBC) and the introduction of Junior Secondary Schools (JSS).

According to Albert Njeru, the Secretary General of the Kenya Union of Domestic Hotels, Educational Institutions, Hospitals, and Allied Workers (KUDHEIHA), the redundant staff were served notices by their respective Boards of Management (BOM) last month, with the layoffs taking effect on January 1, 2025.  He has called on the government to reconsider the decision, suggesting that the affected staff should be redeployed within the new junior secondary school system.

He said the affected workers, having served at various levels, understand the system and could still contribute effectively to the transition.

The shift away from the 8-4-4 system to the CBC model has also disrupted the livelihoods of traders who dealt in secondary school accessories, such as textbooks, metallic boxes, and uniforms. As demand for these products has dropped, traders are now left grappling with the financial impact.  The widespread layoffs and disrupted business have forced many individuals into the streets in search of new employment opportunities, further compound-ing the country’s rising unemployment figures. The situation paints a bleak picture of Kenya’s labour market, which had seen some positive growth just a year earlier.

According to the Economic Survey 2024, the number of jobs in the formal and informal sectors increased by 848,200 in 2023, reaching a total of 20 million jobs.

However, with the rise of policy and structural challenges, much of this progress appears to be in jeopardy. The survey indicated that wage employ-ment in the modern sector grew by 4.1 per cent, creating 122,800 new jobs.

Yet, the World Bank’s projections signal a grim reversal as the country faces rising challenges to maintain economic stability and employment crea-tion. In addition to the education sector disruptions, Kenya is grappling with a tough business environment.

A CEOs survey conducted by the Central Bank of Kenya (CBK) has shown that many employers are reluctant to hire in 2024, citing the rising cost of doing business, high taxation, and other global factors as significant barriers.

The survey revealed that many firms are focusing on mitigating costs, managing risks, diversifying operations, and increasing their marketing efforts instead of expanding their workforce.

The high tax regime, compounded by reduced consumer demand, continues to stifle economic growth, and businesses are feeling the strain.

As if to reinforce the bleak outlook, a gazette notice dated January 3, 2024, revealed that approximately 200 companies had been shut down by the Registrar of Companies.

The notice provided no specific reasons for the dissolution of the companies, but it adds to the growing uncertainty in the labour market, deepening the unemployment gap and leaving many Kenyans in limbo.

Kenya’s economy, heavily reliant on agriculture, tourism, and services, has also struggled to recover from the aftereffects of the Covid-19 pandemic and the disruptions caused by global events such as the Ukraine-Russia war.

The war has pushed global commodity prices higher, exacerbating inflation and eroding consumers’ purchasing power. Meanwhile, high interest rates have made it difficult for businesses to access credit, stifling investment opportunities.

The strain on the formal sector, which has been unable to absorb the growing number of job seekers, has forced many individuals into the informal sector.

While the informal sector accounts for over 80 per cent of Kenya’s employment, it too has been under pressure due to reduced demand for goods and services as household budgets tighten.

This leaves many Kenyans facing limited opportunities, particularly the youth, who are expected to bear the brunt of the worsening job market.