Economy

More firms to hire on economic recovery

hiring

Graduates queue for job interviews. FILE PHOTO | NMG

A third of companies and banks expect to increase their employee numbers this year, signalling relief for thousands who are still out of work after losing jobs due to the Covid pandemic.

Chief executives told the Central Bank of Kenya (CBK) in a periodic markets perceptions survey carried out last month that increased demand for goods and services, and the need to expand and launch new products call for hiring additional staff.

Optimism on new hirings has gone up since the previous survey done in November last year when 26 percent of non-bank firms and 31 percent of banks said they expected to hire more workers.

Companies in the transport sector are the most bullish about hiring, citing higher demand for their services on increased economic activity, while those in the tourism sector are expecting higher visitor flows following the improved uptake of vaccines.

The survey shows that approximately 33 percent of bank and non-bank respondents expected their companies to hire in 2022.

"Banks expected to hire to support expansions and new products, while transport sector respondents expected increased employment with increasing demand for services as businesses return to normal levels,” said the CBK.

“Hotel respondents expected business to continue picking up slowly with the easing of restrictions and good uptake of vaccines, hence requiring more workers, while other non-bank respondents expected increased job opportunities with business expansions as a result of increasing demand.”

The percentage of firms expecting to cut jobs also fell significantly between November and January.

In November, 30 percent of non-bank respondents told CBK they expected to shed jobs, compared to just nine percent in January. For banks, this has fallen from eight percent to five percent.

By June 2020, three months after the pandemic hit the country and when restriction measures were at their toughest, there were 1.84 million Kenyans out of employment.

The number had fallen to 1.26 million by March 2021, as per the latest available jobs data from the Kenya National Bureau of Statistics (KNBS), but was still above the 878,460 unemployed as at June 2019.

This shows that the economy still has room to create more jobs, or at least recover some of those that had been lost in the previous two years.

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