SOUND ECONOMY

Treasury says Kenya created 843,900 new jobs in 2019

There were 3,300 more jobs created compared to 2018 even as GDP growth slowed down.

In Summary

• Of the new jobs created, informal private sector contributed the lion share of 724,600, Treasury notes.

• More than 7,000 workers however lost their jobs in 2019 as companies moved to downsize operations with some closing shop, blamed on tough economic times.

Artisans working on a spare engine at a garage. /FILE
Artisans working on a spare engine at a garage. /FILE

At least 843,900 new jobs were created in 2019, according to National Treasury figures, this is despite a slow down in the economy marked by lay-offs and closure of various firms.

The data indicates 3,400 more jobs were created compared to 840,600 in 2018 (captured in the 2019 Economic Survey), even as Gross Domestic Product (GDP) growth slowed down to 5.6 per cent from 6.3 per cent the previous year.

“Increased economic growth has resulted to improved per capita income from Sh80,634 in 2010 to Sh106,338 in 2019 and stimulated job creation in the informal sector,” Treasury PS Julius Muia noted at the public hearings on Sector Budget Proposals for 2020/21 which end today.

Of the new jobs created, informal private sector contributed the lion share of the jobs at 724,600, Treasury notes.

The formal private sector created 80,010 jobs while public sector churned out 27,340 new jobs.

This is despite a drop in key GDP contributors of agriculture which fell to 0.9 per cent from 1.4 per cent, service sector which equally slowed down to 3.2 per cent compare to 3.4 per cent in 2018 and industries which contributed 0.8 per cent to the GDP.

Jubilee Job Creation
Jubilee Job Creation

This is a drop compared to the 1.0 per cent it contributed to the economy the previous year.

“Agriculture sector is negatively impacted by unfavorable weather conditions,” Muia said, noting the sector has had its fair share of challenges in the years 2011,2014,2017 and 2019.

The highest number of jobs created in the last five years however remains in 2017 when a total of 903,000 jobs were created.

The lowest during the period was in 2016 when the economy had 820,200 new jobs. A total of 827,300 jobs were created in 2015, Treasury data shows.

 
 

“Despite spillovers of the global economic upheavals, Kenya’s economy continued to make significant progress leading to full realization of the economic potential,” Treasury CS Ukur Yatani said.

He has named high income inequalities, high levels of unemployment especially among the youth, poverty, inadequate infrastructure, shortage of appropriate housing and food insecurity as major challenges which have haunted the country in recent times.

Other are communicable and non-communicable diseases and water and sanitation problems.

“Like most countries, our economy is also prone to risks associated with globalization, external shocks, unfair trade practices, vagaries of weather and internal and external security threats,” the CS noted.

The government has since projected a 6.1 per cent growth for 2020.

Treasury's estimates for 2019 new jobs however contradict what was witnessed in the year, which was described by a larger section of the private sector as “tough economic times.”

More than 7,000 workers lost their jobs in 2019 as companies moved to downsize operations with some closing shop, blamed on a number of factors among them poor policies, low access to credit and pending bills which affected their operations.

Companies that sent home staff include betting Betin which sent parking 2,500 workers, Finlays Flowers which closed two farms rendering more than 1,000 workers jobless and SportPesa which laid off at least 400 workers.