Inflation, levies dim employment earnings outlook

A fruit and vegetables trader: Food takes up the largest share of the basket of goods that is used to calculate inflation, making it the main driver of the cost of living. PHOTO | FILE

A relentless rise in inflation to a 19-month-high in April, coupled with a raft of newly-introduced statutory deductions, risk eroding the Kenyan workers’ take-home this year, reversing gains from 2018 when employment earnings were above the cost of living.

Data by the Economic Survey 2019 shows that inflation-adjusted pay — technically known as real wage — rose by 3.2 percent in 2018, which was an improvement from the previous year when formal sector employees took a pay cut of 2.9 per cent when their wages were adjusted for inflation.

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Note: The results are not exact but very close to the actual.