Jobs in the manufacturing sector are set to grow by a marginal 1% to 24% in Q4 2019 from 23% in Q3 2018 as players in the sector decry a tougher operating environment.
The Kenya Association of Manufacturers (KAM) January to March 2019 Manufacturing Baramoter shows that despite remaining optimistic on the country’s economic growth, players in the sector have pointed out a raft of factors that they think will be major hindrances towards their own growth.
Manufacturers cite the exchange rate instability, decreasing profitability, taxation policies and pressure from increased wages as some of the major headwinds to growth.
Fuel price instability and high prices of imported materials are also cited as inhibitors to growth.
This will come as a blow to job seekers who have complained about lack of jobs as Kenyan institutions continue to churn out more graduates who are completely thrust into an ultra-competitive job market.
The Economic Survey 2019 shows that the economy created 840,000 jobs in 2018, a drop from 2017 when 897,000 new jobs were created.
More than eight listed companies have issued profit warnings, projecting more than 25% decline in profits, East Africa Portland Cement and UNGA are manufacturers.
During Labour Day celebrations last week, workers were left dejected after Cabinet Secretary Ukur Yatani failed to announce an increase in basic pay, KAM has not offered an explanation as to why it has listed pressure from increased wages in this list.
KAM’s decision to point out the government’s taxation policies will raise questions given that a number of betting companies are mooting exiting the Kenyan market citing a business unfriendly tax regime.
The Kenya Revenue Authority (KRA) has introduced six different forms of tax on the gaming industry as the government seeks to finance its ambitious Ksh2.81 trillion budget for the 2019/20 financial year