Kenya’s economy grew by 5.6 percent in 2023, creating 848,200 jobs, with 85 percent, or 720,000, in the informal sector, according to new data. The large informal sector, known as Jua Kali, plays a significant role in employment and income generation.
The Economic Survey for 2024 indicates more people are turning to this sector to sustain themselves.
The Kenya National Bureau of Statistics (KNBS) reported a 4.5 percent increase in informal sector employment, from 15.9 million in 2022 to 16.7 million in 2023. In 2022, employment in Kenya rose by over 815,000, predominantly in the informal sector, with 15.9 million working informally and about 3.2 million in the formal sector. By 2023, total employment reached 20 million, with 16.7 million in the informal sector and 3.3 million in the formal sector.
Wholesale and retail trade, along with hotel and restaurant services, are the most common activities in the informal sector, employing 9.7 million people, or 58 percent of the sector. This sector’s growth contributed to the overall economic growth of 5.6 percent in 2023, up from 4.9 percent in 2022.
President William Ruto recently announced new laws and policies to boost IT-enabled services, aiming to employ over one million Kenyans. These measures focus on expanding opportunities in the Business Process Outsourcing (BPO) services sector by increasing government investments in infrastructure, such as national broadband and digital hubs.
The goal is to create jobs for at least one million digital workers within the next five years.
“We are determined to claim our fair share of the BPO pie for the benefit of our young men and women who are eager to contribute to growing our economy,” he said.
Ruto emphasized Kenya’s advantages, including a large, skilled youth workforce, supportive government policies for the digital economy, and an education system that prioritizes digital skills and TVET training.
He also highlighted Kenya’s strategic geographical location and English proficiency. These remarks were made during the launch of Call Centre International (CCI) Global Contact Centre at Tatu City in Ruiru, Kiambu County, which has already created over 5,000 jobs.
Despite these efforts, Kenya’s unemployment rate slightly decreased from 5.64 percent at the end of 2022 to 5.6 percent. However, youth unemployment remains high at 13.4 percent, with the highest unemployment rate of over 15 percent among those aged 20 to 24.
