HIGH JOB LOSSES

State to set up unemployment relief fund

To cushion workers who lose their jobs

In Summary

• The fund will be part of the recovery plan on the labour market from the ravaging effects of Covid-19.

• The state will also conduct an impact assessment on the effect of covid-19 pandemic on migrant workers.

Analysts polled by Reuters expected the unemployment rate to edge up to 25.3 per cent in the first quarter
UNEMPLOYMENT: Analysts polled by Reuters expected the unemployment rate to edge up to 25.3 per cent in the first quarter
Image: REUTERS

The national government is planning to establish an unemployment relief fund to cushion workers who lose their jobs.

Labour CS Simon Chelugui said on Thursday the fund will be part of the recovery plan from the ravaging effects of Covid-19.

He said despite Covid-19 guidelines significantly containing the spread of the virus, they have also led to unintended outcome of job losses.

The CS was speaking during the employers’ annual virtual conference. He said the state will also conduct an impact assessment on the effect of Covid-19 pandemic on migrant workers.

“Millions of employers and employees are already suffering immediate losses in terms of income and employment. This pandemic has affected not only the health of the workers, but also the number of jobs available,” Chelugui said.

Many businesses worldwide, especially small enterprises, have recorded losses, threatening their operations and solvency.

The informal sector in Kenya, which employs 59.9 per cent of workers has witnessed massive job losses. The sector comprises wholesale and retail trade, hotels and restaurants.

Social and personal care services which include saloons and barber shops and the transport sector have also been largely affected, Chelugui said.

In March, the International Labour Organization said the Covid-19 pandemic could increase global unemployment by almost 25 million.

It indicated that underemployment was bound to happen on a large scale, as the economic consequences of the virus outbreak translate into reductions in working hours and wages.

Chelugui urged businesses to build frameworks that can help them bounce back from external shocks such as Covid-19.

“For this reason, businesses need to adapt to changes as fast as they happen and ensure their preparedness for future pandemics or crises to ensure business continuity,” the CS said.