Nearly a third of chief executive officers (CEOs) expect to hire more workers in the next three months on improving business activity, stemming rampant job losses that had been seen in the coronavirus environment.
About 26.7 per cent of CEOs that took part in the Central Bank of Kenya (CBK) May survey said they will increase the number of full-time employees on the back of growing sales as customer orders increase.
The majority (62.2) per cent of the CEOs expect to retain their current staff numbers as economic activities rise, while 2.2 per cent expect to cut workforce in the next three months.
“Most CEOs expect business activity to strengthen in the third quarter. Respondents in the services and manufacturing sectors were the most optimistic with the majority reporting a general upward trend in business activity,” said CBK.
The latest survey findings—drawn from firms mostly employing between 100 and 500 workers—marks an improvement from the 10.6 per cent CEOs that had hired more workers in the second quarter as 14.9 per cent actually laid off.
Most firms cited a highly skilled workforce as their top strength in delivering good customer service.
About 1.72 million workers lost jobs in three months to June when Kenya imposed a lockdown to curb the spread of the coronavirus and recovery has been slow with salary cuts persisting in many sectors.
Some 22 per cent of the CEOs had laid-off workers in the first quarter of the year as the State’s Covid-19 control measures hurt the demand for goods and services. However, the May survey has revealed increased optimism by responding CEOs on factors such as continued reopening of the economy, rollout of the vaccination programme and access to East African Community (EAC) market.
“This optimism was mainly attributed to expected post-Covid-19 bounce-back, businesses shifting to more digitisation and anticipated increase in exports following improved relations in the EAC countries,” noted CBK.
The CEOs cited a more predictable tax regime, pro-growth taxation policy and faster processing of tax refunds as the key issues they would like the State to address in order to sustain growth.
Markit Stanbic Bank Kenya Purchasing Managers’ Index (PMI) had showed Kenya’s employment market conditions darkened in April as private firms cut jobs for the first time in seven months.
The firms were hurt by month-long curbs on travel and longer nighttime curfews in the capital Nairobi and four surrounding counties to control the spread of Covid-19.
Under the restrictions imposed in March but relaxed on May 1, Nairobi, Kiambu, Machakos, Kajiado and Nakuru were treated as one zone, with residents barred from travelling to other areas.
The State had also suspended in-person schooling and church services, closed bars and restricted restaurants to takeaway services.
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