Rising cost of living erodes Nairobi’s job attraction spell

High cost of living has eroded the allure of Nairobi as Kenya’s city of opportunities forcing the majority of workers and job seekers to try their luck in other towns, an employment survey has revealed.

The study, which was carried out in January this year, found that seven out of 10 workers in Nairobi would move to other towns if they saw a window of opportunity or an alternative job presented itself.

That was in sharp contrast to seven years ago when a similar survey found that nearly 80 per cent of workers and job seekers picked Nairobi as their city of choice.

Corporate Staffing Services (CSS), the human resource consulting and recruitment firm which carried out the survey, Tuesday said more than 72 per cent of Nairobi’s employed population is willing to move to other locations that are not necessarily their home towns.

The study polled 386 employed and unemployed people from eight districts and human resource managers from 21 companies.

Out of the total respondents, the unemployed (132) were more inclined (84.6 per cent) to direct their job search away from Nairobi. The fear of Nairobi was particularly high among entry-level job seekers who find it hard to survive the harsh realities of the Kenyan capital.

The city’s loss of lustre has been attributed to the hardships associated with high cost of housing and other basic goods and services such as transport, water, electricity and food.

Nairobi and Mombasa, Kenya’s second largest city, have also suffered a disproportionate level of crime in recent years, including sporadic terrorist attacks by Al-Shabaab, the Somalia-based Islamic militants.

Human resource experts said county governments, which came into existence after last year’s General Election, have provided realistic alternative centres of employment in less stressful environments, taking away some of the attention from Nairobi.

“The counties have become new frontiers of opportunities hence the willingness by Nairobi job seekers to move,” CSS managing director Perminus Wainaina said during Tuesday’s release of the report.

Early this month a global report by UK-based Economist Intelligence Unit ranked Nairobi as Africa’s most expensive city underlining how difficult it has become to live in the city for those in casual employment, low-paying jobs and job seekers.

READ: Nairobi ousts Lagos as Africa’s most expensive capital

The cost of commuting in Nairobi has also risen by more than 20 per cent since January following the enactment of the County Finance Act that doubled parking fees. The law also pushed up property rates, increasing the cost of doing business in the city.

Heavy fuel consumption and loss of man-hours in gridlock jams has become one of the main challenges for Nairobi dwellers besides cut-throat competition for limited opportunities.

Starehe — which includes the central business district —Makadara, Embakasi, Westlands and Dagoretti divisions were surveyed for responses of Nairobi residents.

The survey also found that most of Nairobi’s employed population are not content with their current pay and were not sure whether they would continue holding the positions.

Mr Wainaina said the finding on job satisfaction was particularly important for business leaders and employers who must find smarter ways of motivating and retaining staff.

That view is in tandem with a recently finding by consulting firm PricewaterhouseCoopers (PwC) that Nairobi’s managers are finding it hard to stick with top talent in the face of rising competition for human resource.

READ: Life gets tougher in Nairobi as City Hall raises charges

Out of those polled in the CSS survey, 66.5 per cent said they would change jobs in the event they spotted greener pastures.

Better pay ranked top among those hunting for alternative employment opportunities at 35.8 per cent followed by job security at 22.1 per cent.

Workers’ decision to move or stay with an organisation is also influenced by favourable working environment, respect and appreciation of their efforts, the survey says.

The study also found that non-governmental organisations (NGOs), and not the government, are the most preferred employer in Kenya. This is mainly because most NGOs pay international salary scales.

More than 27 per cent of the unemployed and employed respondents felt that NGOs are the ideal employers for better pay and personal advancement.

The survey found that the broad-based informal sector has low-level appeal among the youth, including those who opt to go for entrepreneurship.

Mr Wainaina said that finding should be key to policy makers’ understanding of what needs to be done to deal with rampant unemployment in the country.

“It requires a shift of the mind to dispel the notion among graduates that they must all be absorbed in the small and crowded formal employment space,” he said.

The survey also found that the majority (89.3 per cent) of respondents working for parastatals and other government departments were content with packages attached to their positions, offering the government some relief on the very touchy subject of staff retention.

The position could, however, change if the government pushes through the proposed austerity measures, including salary reductions to stop the runaway wage bill.

Besides, about 65.8 per cent of those in self-employment were content with their incomes compared to only 54.8 per cent for those in the private sector.

The report suggests that the high satisfaction levels among employees of parastatals or the government are partly attributable to the low stress levels experienced at work compared to their counterparts in the privates sector.

Kenya’s privates sector remains the biggest generator of employment opportunities that accounts for 51.8 per cent of the workforce.

Only 11.2 per cent of the working population are in the public sector. NGOs account for 7.6 per cent of the workforce while self-employment has 29.5 per cent.

The report sheds light on an emerging trend where firms are resorting to contractual employment as opposed to fixed terms.