TOUGH TIMES

Nairobi bars, clubs on slow re-hiring as sector struggles to recover

More than 250,000 jobs have been lost in the industry since 2020, only 10,000 have had their jobs restored due to the slow rate of hiring.

In Summary

•Banking on the ongoing recovery of the economy, the 40,000 bars owners remain hopeful to pull out of the Covid-19 inflicted slump.

•More than 250,000 jobs have been lost in the industry since 2020, only 10,000 have had their jobs restored due to the slow rate of hiring.

Attendants clean a bar in Nairobi/FILE
SLOW BUSINESS: Attendants clean a bar in Nairobi/FILE
Image: FILE

After hanging on through two years of lockdowns, Nairobi bars and clubs owners are upbeat about the future.

Banking on the ongoing recovery of the economy, the 40,000 bars owners remain hopeful to pull out of the Covid-19 inflicted slump gradually.

According to a survey by the Bar, Hotel and Liquor Traders Association (BAHLITA) more than 250,000 jobs have been lost in the industry since 2020.

Out of this, only 10,000 have had their jobs restored due to the slow rate of hiring.

"We are operating at a small capacity so that we get something small for the business so we can pay a major debt we acquired in December, 2020. WE cannot afford new staff," John Nduta a manager at a pub in South b said.

BAHLITA secretary general Boniface Gachoka said hotels and bars have lost more than Sh150 billion from the onset of the pandemic. 

Most bars and restaurants across the country were forced to close or transition their operations to delivery or takeout.

As on-premise sales dropped off a cliff, the government responded with temporary executive orders allowing bars and restaurants to sell restricted amount of alcohol to customers.

Data from BAHLITA shows at least 20,000 establishments, including bars, night clubs and hotels, closed indefinitely since the pandemic hit the country in March 2020.

As of May this year, only 5,000 had reopened.

"The post Covid effects have been very tough on us. We are still not recovered as we expected," Gachoka said.

He said majority of bars and clubs are still struggling with loans amid low returns from businesses.

Bar, Hotel and Liquor Traders Association (BAHLITA) secretary general Boniface Gachoka.
Bar, Hotel and Liquor Traders Association (BAHLITA) secretary general Boniface Gachoka.
Image: HANDOUT

“Last year was a tough year with the lock-downs and restricted operating hours but we still hanged in there.We are hoping 2022 will be better," Gerald Lidwaji, manager at V1 Sports Bar and Grill in Lang'ata, Nairobi told the Star.

POLICE HARASSMENT

The association had projected recovery to pre-pandemic levels to take at least five years. However, it now says unprecedented blocks, including harassment by police officers pushes the process to 11 years.

Owners of bars and liquor outlets in the past months have been lamenting increased police extortion saying the trend is now threatening to cripple their businesses.

Owners who are barely getting enough gains say they have to part with Sh50 to Sh200 on a daily basis, to keep the cops 'friendly'.

Becky Chebet, a bar owner in Embakasi South constituency, told the Star on  Wednesday that the police had made it a norm to collect monies  whether she made a sale or not.

Another liquor trader Grace Linda Atieno painted a similar scenario, and called upon government agencies to rescue their business by taking action against rogue officers.

Their complaints come a month after a viral case in which an Officer Commanding Station in Kitengela, Kajiado County was transferred to a new station after several complaints of extortion  were made by liquor and bar owners in Kitengela.

The issue was raised by a female liquor trader Marceline Atieno, who narrated how she had to part with a protection fee of Sh5,000 every month, given to the OCS by the fifth of every month without fail.

Bar association said this trend is delaying the recovery progress.

"A few of our members especially in Nairobi were compromising the police for them to go against the Covid-19 restrictions. The police were used to that behaviour and now they are still coming, it is a major problem," Gachoka said.

ELECTION JITTERS

Like any other sector, investors in bars and hotel industry are in a wait and see position about the uncertainties that comes with elections.

Gachoka said there is significant caution as players weigh on how to protect their businesses.

"Because of the up coming elections, banks have retreat investments in the hotel industry as post -election effects really impact the sector," he said.

LOANS

Several establishments had to take financial aids to remain buoyant and heal from the pandemic.

These loans are said to be weighing down development and recovery in major players.

Even so, the industry received a number of financial aid from both the government and others.

For instance, EABL last year announced a Sh532 million ($5 million) recovery fund to help pubs and bars resume trade post-lockdown.

The two-year plan dubbed “Raising the Bar” is part of the Sh10.6 billion ($100 million) kitty rolled out from June 1, 2020 in different markets through EABL’s parent firm, Diageo.

EABL said the recovery plan will offer targeted support like purchasing equipment such as hygiene kits, permanent sanitiser dispenser units, hand sanitisers, masks, and protection screens for bars that cannot maintain the one metre social distance.

This all went towards ensuring these establishments remain open in the long term, under the strict Covid-19 guidelines.

Social distancing  cut operating capacity by almost 50 per cent, industry players said.

The festive season mainly Christmas and the New Year saw hotels and entertainment spots make gains from high number of customers, with a number of them hoping this year will be better.

The removal of the nation-wide curfew in October last year saw increased operating hours for bars and restaurants, with some having licenses to operate 24 hours.

“The festive season helped restore relations that we had spoiled including sending home of employees. Businesses have been able to recall some of them, clear rent arrears and pay suppliers. Majority are however still operating in losses,” Gachoka said.

Government data in collaboration with the Kenya Private Sector Alliance indicates the hospitality and tourism industry was the most hit with 3.1 million jobs affected in the first year of the pandemic.