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The Undeniable Truth About The Jua Kali Sector In Kenya’s Economy

Shadrack Olaka




Just like words, numbers too can be used as weapons by politicians. Because numbers don’t lie, politicians have perfected the art of using them to hide the truth.

One economic concept that has been made to fit a political narrative is that of GDP (gross domestic product), defined as the monetary value of all finished products in an economy.

The current leadership, just like many others globally, has been having a habit of using the big step in GDP growth to demonstrate its great economic achievement in comparison to the previous governments.

This continues to happen even as Kenyans raise more concerns about the lack of decent jobs.

The experts have described this trend as jobless growth where there’s a fast growth pace economically while employment drags on far behind.

In the 10 years to December 2019, Kenya’s nominal GDP (not adjusted for increase in prices) expanded by a staggering 240 per cent.

The National Treasury by dividing the country’s GDP which is estimated to be Ksh9.74 trillion by its population of 48 million, has found out that by end of year 2019, every single Kenyan was worth Sh204,783, an increase of five times from an income per capita of Ksh40,292 in 2009.

However, the Kenya National Bureau of Statistics (KNBS) data showed that the number of workers being paid salaries or those with decent job with having a regular paycheck, increased only by 46 per cent to 2,928,300 in 2019 in comparison to 1,999,300 which was in 2009.

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In addition to that, about tens of thousands of graduates enter into the labour market evert year, joining the rest of jobless Kenyans who will tarmac for years searching for non-existent jobs.

This the so called phenomenal growth in GDP covers a comfortable lie: jobs, moreso good jobs, haven’t grown as fast as the economy is portrayed to grow.

It is in the Jua Kali sector where jobs have been generated largely where government policy, even the current pandemic environment hasn’t reached. This is according to Mr Mbui Wagacha, formerly a senior economic advisor to the President Uhuru Kenyatta.

In any hard-nosed economists, the GDP is the holy grail of any economy.

An American economist by the name Simon Kuznet who developed it in 1934, GDP calculation will consider into account the price you paid for the newspaper, your car’s fuel, medical treatment or even the school fees you pay for your child(ren).

To be more precise, an increase in production of the goods and services, should give birth into more jobs.

Analysts revealed that development in technology recently has meant that less money is channelled to workers as a reason being machines replacing humans in most of the jobs.

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According to Dr Wagacha, some of the key sectors such as finance and ICT have advanced greatly in digital delivery.

Many Banks have recently been laying off employees as the mobile phones replace the them.

Almost every bank currently wants to restructure after going through a rough stretch brought by Covid-19, which has seen many borrowers failing and struggling to repay their loans.

Mr. Gerishon Ikiara, a former Transport permanent secretary and an economist, said that employers are simply giving other factors of production such as equipment, technology and capital more than labour.

He also stated that if employees were more productive, then the employers would have been able to pay higher wages.

The employees could also be poorly paid because there are many competing for the same jobs.

About nine in every 10 of all jobs are from the Jua Kali sector.

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