Kenyan employers are struggling to recruit industry-ready workers despite thousands of young people entering the labour market each year, with a new study linking the challenge to a gap between workplace demands and the skills many graduates possess.
The PropelA Return on Investment (ROI) Study, released by Swisscontact on July 21, found that while companies are looking for workers with practical, job-ready skills, many young people continue to miss out on employment opportunities because they lack the hands-on experience required in today’s workplaces.
The study argues that the problem is not simply about unemployment but stems from a growing disconnect between training institutions, industry needs and the skills employers expect from job seekers.
Conducted by Orange & Teal on behalf of Swisscontact, the independent study examined the impact of the PropelA Dual Apprenticeship Programme, an industry-led initiative that combines classroom learning with structured workplace training.
The findings were unveiled during the PropelA Business Impact and Investment Insights Breakfast in Nairobi, which brought together business leaders, government officials, development partners and industry stakeholders to discuss solutions to Kenya’s growing workforce challenges.
Businesses Paying the Price for Skills Gap
According to the study, employers continue to face difficulties filling vacancies because many applicants do not possess the practical competencies needed to perform effectively from the first day on the job.
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As a result, businesses are forced to spend more on recruitment, orientation and additional training before new employees become productive.
The study notes that the shortage of industry-ready workers has also contributed to lower productivity, delayed expansion plans and reduced competitiveness, particularly among small and medium-sized enterprises (SMEs).
At the same time, thousands of young Kenyans struggle to find decent employment despite completing their education, showing the mismatch between the skills being taught and those demanded by employers.
Swisscontact says these are not two separate challenges but different sides of the same problem, with skills development failing to keep pace with the changing needs of the labour market.
Apprenticeship Programme Delivers Strong Returns
The study found that businesses investing in the PropelA Dual Apprenticeship Programme are already seeing measurable economic benefits.
Companies participating in the programme recorded an average 30 per cent Return on Training Investment (ROTI), generated approximately Sh2 million in net value per company and recovered their investment within three years.
Researchers also found that nearly 87 per cent of the value created came directly from productivity gains made by apprentices while working within participating companies.
The findings suggest that investing in practical workplace training is not only beneficial for young people seeking employment but also makes financial sense for businesses looking to improve efficiency and long-term growth.
Swisscontact Kenya Country Director Sharon Mosin said the findings challenge the long-held belief that skills development should be viewed only as a social responsibility.
“The findings challenge us to rethink how we view skills development. Skills are not simply a social investment. They are economic infrastructure. Just as roads connect markets and energy powers industry, skilled people drive productivity, competitiveness and growth. When businesses invest in skills, they are investing in their own future,” she said.
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Industry-Led Training Bridging the Gap
According to Swisscontact, the PropelA Dual Apprenticeship Programme was developed to bridge the gap between education and employment by placing employers at the centre of workforce development.
The programme combines 75 per cent workplace learning with 25 per cent classroom instruction, allowing apprentices to gain practical experience while acquiring nationally recognized qualifications.
Unlike conventional training programmes, apprentices work directly with employers, enabling them to develop technical skills, workplace discipline and industry experience before joining the labour market full-time.
Since its launch, PropelA has partnered with more than 70 companies, trained over 400 young people and achieved an employment rate of more than 80 per cent, demonstrating its potential to address both youth unemployment and skills shortages.
The programme, which initially focused on electrical and plumbing trades, has since expanded to include welding, lift and escalator maintenance, maintenance services and selected hospitality occupations. Swisscontact believes the model can also be adapted to sectors such as manufacturing, transport, energy and agribusiness.
Growing Demand for Skilled Workers
The report comes at a time when Kenya is pushing ahead with industrialization, infrastructure development and manufacturing under the Bottom-Up Economic Transformation Agenda (BETA), increasing demand for technically skilled workers across several sectors.
However, the study warns that without stronger collaboration between businesses, Technical and Vocational Education and Training (TVET) institutions and government, employers will continue struggling to find qualified workers while thousands of young people remain unemployed.
Swisscontact argues that aligning education with industry demand will not only improve employment outcomes for young people but also strengthen enterprise productivity, enhance business competitiveness and support Kenya’s long-term economic growth.
The study concludes that industry-led apprenticeship programmes offer a practical solution to the country’s skills shortage by enabling businesses to develop the workforce they need while giving young people a clearer pathway from learning to earning.
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