In a significant shift within the corporate landscape, several local companies have announced mass layoffs in 2024 citing restructuring efforts.
Among the companies affected are Nation Media Group, Copia Kenya, WPP Scangroup, Radio Africa Group, and Directline Assurance.
These firms have attributed their workforce reductions to a combination of factors ranging from high taxation, declining investor capital, reduced profitability, changing industry trends among others.
The decision to downsize underscores the mounting economic pressures facing businesses in Kenya, prompting many to reevaluate their operational strategies in an increasingly competitive market.
Radio Africa Group
On July 21, Radio Africa Group issued a notice to all its employees announcing plans to restructure business operations, a move that would result in significant job losses across the company.
In an internal memo dated July 17, the company’s management cited the numerous challenges facing the media industry as the primary reason for the restructuring.
“As you may be aware the media industry has been going through tough times in the recent past. The changes have affected business model and has caused unexpected changes in the business strategy and structures.”
The memo also explained that the planned layoffs would be implemented in batches, with the company promising to respect the contractual obligations of its staff.
Also Read: Kenyan Companies Among Top 10 African Firms with Biggest Mass Layoffs_Report
Nation Media Group
The Nation Media Group (NMG) announced on June 7, 2024, that it would be engaging in a workforce reduction.
In a statement, the media house cited the rapid changes in the journalism world as the reason for its restructuring.
“As part of the continued implementation of our strategy, we are evolving into a leaner, more agile organization that will drive the efficient delivery of services to our audiences and innovate rapidly to reap the benefits of the digital economy.
“Regrettably, this will necessitate a workforce reduction.” read the statement in part.
This followed a similar announcement in April where NMG said it would fire 600 employees, including journalists.
In an internal memo dated February 5, 2024, Nation Media issued its staff a one-month notice of its intention to declare the 600 employees redundant in the wake of reduced revenues.
“I wish to notify all members of staff of the company’s intention to declare redundancy of 600 employees across various departments at the end of Q1 (April 2024),” read the memo.
The NMG CEO Stephen Gitagama said the move was necessitated by a drastic drop in revenues in the past few years caused by a disruption of its advertising in 2023 and 2024 following 20 months of unpaid advertising revenue from the Government Advertising Agency (GAA).
Copia Kenya
In May, Copia Kenya announced that it would be undergoing a restructuring process which would result in the firing of at least 1,000 employees from various departments.
Explaining the reason for the move, Copia’s management indicated that it was undergoing financial challenges and was therefore unable to sustain the employees.
Also Read: Kenyan CEOs Explain Why they Will be Firing Employees in 2024
Additionally, the company said that the restructuring was taking place against the backdrop of a difficult capital markets environment in Africa.
In a notice, the company said that it had hired Makenzi Muthusi and Julius Ngonga from KPMG to lead an administration process aimed at providing direction in sustaining its operations.
WPP Scan group
Advertising firm, WPP Scan group announced in April that it was engaging in a comprehensive restructuring plan that includes staff layoffs and changes in its corporate structure.
The company blamed a challenging economic environment, which it said led to cautious spending by its clients on advertising, marketing, and communications.
Similarly, in November 2023, the company issued a profit warning, citing the “continued subdued economic environment in markets of operations” as a key factor.
The firm also reported spending Ksh 178 million on a one-time staff retrenchment during that period.
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