Business registrations drop by 16pc as Kenyans get new jobs

New company and business registrations dipped 16 percent over the 12 months to June as more Kenyans who had rushed to entrepreneurship after job losses due to the Covid-19 pandemic returned to work.

Latest data from the Registrar of Companies show that some 128,800 business names and private firms were registered in the year to June, down from 154,155 in a similar window of last year.

This was as the country’s economic growth got a boost from the easing of the Covid-19 restrictions, spurring job creation in major sectors.

Data by the Kenya National Bureau of Statistics (KNBS) shows that a higher-than-expected 7.5 per cent economic growth last year led to creation of about 926,000 new jobs, easing the pressure on individuals to start their businesses to eke a living.

The KNBS data shows the total employment outside small-scale agriculture and pastoralist activities grew by 5.3 percent to hit 18.33 million last year from 17.4 million driven by sharp growth in trade, manufacturing, tourism, construction, and transport.

This for the first time pushed Kenya’s employment above the pre-pandemic level of 18.14 million in 2019.

Education sector

The education sector created most of the new jobs with 609,200 openings following the resumption of learning in schools.

Manufacturing also enjoyed a good turnaround in fortunes adding 6.3 percent more jobs which brought the number of workers in the sector to about 336,800. It benefited from the lifting of travel restrictions that had frozen the supply of goods from major source markets such as Asia and Europe.

Other sectors that drove the creation of new jobs include public administration, agriculture, and wholesale and retail, which created 5.9 percent, 4.6 percent, and 2.6 per cent more jobs respectively.

The country recorded a sharp rise in business and company registrations when the pandemic struck two years ago.

About 1.72 million workers lost their jobs within just the first three months of the pandemic between April and June of 2020, according to KNBS data, forcing them to turn to self-employment to make ends meet.