Residents stage protests outside the East African Breweries plant in Kisumu on December 7, 2017, calling for employment. PHOTO | FILE | NATION MEDIA GROUP Thousands of families stare at bleak economic times following a wave of employee layoffs announced by leading companies in the past few weeks.
The job losses in commercial banks, breweries and cement manufacturing sectors sharply contrast the lauded economic growth painted by official data and present policymakers with the need to rethink a working solution for a country whose economic growth contradicts its job market.
In the past one month, at least six companies have signalled staff layoffs, which come with economic ripple effects given the number of dependents that rely on the close to 2,000 people set to lose their jobs.
East African Portland Cement Company (EAPCC), Telkom Kenya, Stanbic Bank of Kenya and East African Breweries Limited (EABL) have already notified employees of the looming layoffs, citing the need to trim their payrolls. Two other banks are said to have issued similar notices this week.
TOP-DOWN APPROACH
The difficult economic times cited by the affected companies is in sharp contrast to the improving business environment that has seen Kenya move several steps in the Ease of Doing Business ranking.
Those to be sacked now join a pool of other jobless youth at a time when universities are spewing at least 50,000 graduates per year into the job market.
While technological disruption and increasing automation in the service industry, which is a key sector in the country’s economy, may be blamed for the increasing unemployment, years of policy miscalculations, corruption and poor planning has driven Kenya’s job situation into the abyss.
MANUFACTURING
Economic analysts contend that Kenya has missed lots of job creation chances in the multibillion shilling projects it has been implementing in the past five years with deals entered without factoring in the country’s interests.
Dr Paul Gachanja, Kenyatta University School of Economics dean, says the country should have grabbed the opportunities presented by infrastructure projects to spur job creation, specifically in the manufacturing sector.“If we used these projects to promote local industries in supplying raw materials alone, then you would have ended up with a longer benefit."It is these projects that give you that higher figure and the macro level that the economy is growing, yet the money made ends up going back in material purchases, loan repayment and in some cases labour costs,” Dr Gachanja […]
