250 CEOs Announce Mass Firings
More than 250 CEOs have declared intentions to trim their workforce in the upcoming two months owing to the escalating expenses associated with business operations.
In a study carried out by the Central Bank of Kenya, involving 1,000 CEOs from diverse sectors, 25.7 percent of participants expressed their intention to trim their workforce as part of cost-cutting measures amid efforts to implement austerity measures and decrease operational expenses.
However, 637 participants indicated that they had no plans to hire during the period from February to March. This disclosure brought disappointment to those in search of employment opportunities.
Significantly, among the 1,000 CEOs surveyed, only 106 disclosed their intention to expand their workforce by hiring more employees.
As per the report, the anticipated outlook suggests that the job market has been affected by rising business expenses, primarily linked to escalated taxation.
Significantly, employers have experienced the impact of taxation policies outlined in the Finance Act of 2023, which brought about additional expenses for them, such as the 1.5 percent housing levy.
Furthermore, there was a rise in rates, coupled with the prospect of upcoming deductions for the Social Health Insurance Fund (SHIF).
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“High-interest rates, increased taxation, and the impact of a weaker Shilling are expected to keep input costs elevated, with global geopolitical tensions potentially affecting supply chains.
“Firms that reported possible difficulty in expanding their operations cited difficulties in securing finances for working capital. Other reasons cited included increased overhead costs, notably, the cost of electricity, fuel, labor and an increase in taxation which has worsened the cost of doing business,” read the report in part.
Private security firms have already issued warnings that they may have to terminate half of their workforce if the government proceeds with the directive to implement a minimum salary of Ksh35,000.
The association of private security companies emphasized in a released statement that more than 700,000 individuals would face job redundancy as a result of the process.
In the upcoming two years, it is anticipated that three major companies on a national level, such as Procter and Gamble and Bayer, will withdraw from the Kenyan market. This decision is expected to result in the loss of employment for over 1,000 individuals.
250 CEOs Announce Mass Firings
