Kenya Has the Highest Unemployment Rate in East Africa, Report Shows

Kenya has the highest unemployment rate in East Africa, according to the World Bank. Data shows that 5.7 per cent of Kenya’s labour force is jobless today, an increase of 2.9 per cent in 2013.

Between 2013 and 2021, unemployment rate in Tanzania reduced from 2.9 per cent to 2.6 per cent whilst the rate increased by 1.4 per cent in Ethiopia under the same period. In Uganda unemployment increased 1.0 per cent while in Rwanda the rate went up by 0.4 per cent.

That highlighted, Kenyan economy has grown by an average of 5.0 per cent, however, this growth has come from capital-intensive infrastructure projects which have not trickled down to the average citizen.

Finance experts submit that the country’s private sector has drastically taken up technology leading to high job losses, mostly in the insurance and banking sectors.

Kenya’s unemployment rate is almost twice the 2.7 per cent East Africa’s average, with Rwanda recording the lowest rate at 1.6 per cent. Tanzania, which had a higher rate of unemployment than Kenya in 2013, has lowered its rate below second-placed Ethiopia and third-placed Uganda in the region.

“One of the reasons is the greater adoption of technology which led to a rise in unemployment. Remember banks and fintech shedding jobs?” Prof XN Iraki, an economist at the University of Nairobi, opined.

“Secondly, there has been less than expected economic growth, we never reached the magical 10 per cent envisaged in Vision 2030. The growth has also been driven by large capital projects which are not labour-intensive.”

As International Monetary Fund observes, “Half of African countries (27), with 44.6 percent of Africa’s total population, are categorized as low income. The remainder is distributed between lower-middle-income (18 countries, with 45.9 percent of the population), upper-middle-income (8 countries with 9.5 percent of the population), and high-income (1 country with 0.01 percent of the population)”.

At least 140 million youth in Africa aged between 15-35 years are unemployed. And, according to African Development Bank Group, 263 million young people in Africa will lack an economic stake in the system by 2025.

While unemployment rate in Africa has decreased in the last nine years from 11.7% to 10.6%, the economy remains worryingly unsustainable. Bloomberg recently reported that South Africa had the highest unemployment rate in the world. Although the strength of the indicators understandably used to arrive at such a conclusion is open to question, more reliable sources report that 44 per cent of South African population is unemployed.