FACTSHEET: Has Kenya’s unemployment really dropped to 7.4%?

New labour force numbers from Kenya’s national statistics office suggest unemployment is falling. How were they arrived at?

Kenya’s unemployment rate is 7.4%, according to the Kenya National Bureau of Statistics 2015/2016 Labour Force Basic Report.

This meant unemployment had “declined steadily over the past 10 years”, leaving “the country in awe”, the respected Business Daily newspaper said when the report was released in March 2018.

The newspaper accused the government of “a clear case of downplaying” rising joblessness.

Much of the public conversation has been about how the number was calculated, and whether it reflected the experience of Kenyans.

Other media outlets contrasted the statistics agency’s new rate with recent higher unemployment estimates. These include 11.5% by the International Labour Organisation and a figure of 39.1% attributed to the United Nations Development Programme. (Note: Read our fact-check on why the latter is wrong.)

Here we explain how the agency came to its figure of 7.4%.

How frequent is the survey?

Unemployment is a key economic indicator, but in Kenya the rate has been calculated infrequently over the past two decades.

For 2009, the statistics office found a rate of 9.7%, using data from that year’s population census. In 2005/06, it was placed at 12.7%.

The statistics office planned to do labour force surveys more frequently, director-general Zachary Mwangi told Africa Check.

“In the past, regular labour force surveys had not been institutionalised and the resources did not allow more frequent surveys. But now we plan to do annual and quarterly surveys,” he said.

The agency expected to publish its first annual labour force survey in July 2019, Mwangi added.

How was the latest survey carried out?

The data was collected from September 2015 to August 2016. From a sample of 23,852 households across each of the country’s 47 counties, a total of 21,734 (91.3%) were successfully interviewed.  

Household members were asked whether they had worked at least one hour in the past seven days for pay or profit, or held a job in those seven days. They were also asked to identify their primary and secondary job.

People who had not worked during the seven days, and had no job or income-generating activity to go back to, were asked what steps they had taken in the previous four weeks to look for work or to start some kind of income-generating activity.

If someone had worked for at least one hour in the previous week they were defined as being employed. If they were without work, were available and had actively looked for work in the four weeks before the survey, they were counted as unemployed.  

The statistics agency did have some problems, such as misreporting by respondents and miscoding by interviewers. This was possibly because the work concepts, based on international definitions, were misunderstood. But it said it had accounted for this when weighting the sample to make it nationally representative.

How many people were employed?

The working age population was given as those between 15 and 64 years. Close to 25 million Kenyans fell into this group.

The statistics agency then divided working age Kenyans into three groups: the employed, the unemployed and the economically inactive.

(Note: The economically inactive were neither employed nor unemployed in the seven-day reference period. The statistics office said the main reasons for this were school attendance, family responsibility and sickness or injury.)

Kenya’s working-age population (15-64 years)
Group Number of people
Employed 17,875,700
Unemployed 1,435,800
Economically inactive 5,644,100
Total 24,955,600

Source: 2015/2016 Labour Force Basic Report

Were they all employed full-time?

The 17.9 million employed were divided into:

  • 11.3 million full-time workers (who worked more than 35 hours a week)
  • 1.7 million part-time workers (who worked less than 35 hours a week)
  • 2.3 million casual workers (in short-term employment of not more than 90 days)
  • 2.4 million seasonal workers (such as people who worked during harvest season)

(Note: The numbers do not add up exactly to 17.9 million as a small share was categorised as “other” or “not-stated”.)

The data was further broken down by gender, age group, geography (rural, urban and county) and level of education.

More men (9.18 million were employed than women (8.7 million). The age group 25 to 29 had the highest number of employed people (3 million) while those between 24-25 had the highest unemployed people (552,300).

People unemployed in urban areas (973,400) outnumbered the jobless in rural areas (462,400).

In the unemployed group, 64.5% were female and 85% were younger than 35.

‘Strict definition actually the issue’

Kenya’s employed and unemployed together made up the labour force of  19,311,500 people. To get the unemployment rate, the agency calculated the number of unemployed people (1,435,800) as a percentage of this labour force (7.4%).

The agency said it had adopted the “standard” definition of unemployment, which defines unemployed people as those able to work, are currently without work and are looking for work. This is also known as the International Labour Organisation’s “strict” definition.  

If a person has given up on looking for work or starting some form of self-employment – that is, if they have become discouraged – they fall under the “broad” definition of unemployment and are considered economically inactive.

This definition made explaining unemployment to the public a challenge, Kwame Owino, the chief executive officer of think-tank the Institute for Economic Affairs-Kenya, told Africa Check.

“[Discouraged workers] are unemployed in the factual sense, but they are not unemployed in the sense of what that measurement adopts. So that strict definition [that you have to be looking for work] is actually the issue.”

What about underemployment?

The survey also found that 20% of those who were unemployed – 3.7 million – were “visibly” underemployed. This means they were willing and available to work more hours.

“Invisible” underemployment was measured in terms of income earned, productivity levels or the level at which skills were under-used.

The survey noted that it focused only on the visibly underemployed, using a threshold of fewer than 28 working hours a week. This was also a challenge, Anzetse Were, a development economist, told Africa Check.

“There are many people who are gainfully employed but underemployed,” Were said. “You know the situation of engineers being hired as drivers, or you studied sociology, but now you’re stacking groceries in a supermarket?”

She said the unemployment rate did not reflect that many people were self-employed or worked in the informal economy only because they were unable to get jobs in the formal economy.

The director of production statistics at the agency, James Gatungu, told Africa Check in an earlier report that statisticians struggle to collate accurate data on unemployment, because “in [the] African context, people don’t just stay idle”.

“They do something… like hawking. They are engaged in some form of economic activity. So while they are not employed, they are doing what we call ‘indecent’ jobs; jobs that they were not trained for to eke [out] a living,” he said.

What next?

The statistics agency says that in addition to regular labour force surveys, more analysis should be done on key indicators such as income levels, occupations and skills utilisation.

This, it notes, would help “portray the whole picture of under-employment in Kenya”.

How international bodies calculated their estimates

International Labour Organisation

In 2016, the International Labour Organisation – the UN agency that focuses on labour – estimated Kenya’s unemployment rate to be 11.5%.

To calculate this, it uses a model that takes into account the latest available official data from each country, ILO statistician Yves Perardel told Africa Check.

But Africa Check discovered the calculation was based on an error – Kenya’s official unemployment rate in 2009 was 9.7%, not the 12.17% listed by the ILO.

The ILO acknowledged this, saying the 12.17% it had used was an internal figure that was not double-checked, Perardel said. (Note: The UN agency has since updated the unemployment rate from the 2009 population census in its database.)

Updated estimates – using the latest unemployment data after checking the methodology – will be available in November 2018, Perardel added.

UN Development Programme

Kenyan media often reports that the country’s unemployment rate was 39.1% in 2015, citing the UNDP’s Human Development Report 2016. The figure appears to have been deduced from the report’s finding that Kenya’s employment-to-population ratio was 60.9%  [100% – 60.9% = 39.1%].

But as the 39.1% includes the economically inactive – say, students or women taking care of others at home – it does not signify unemployment, a labour expert told Africa Check. Read our fact-check for more detail.

 

Further reading:

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