The Enterprise of Employment and Wealth Creation in Kenya

Richard  Ochanda and Paul W. Kisolo

Statistics have placed the poverty incidence at 56% in Kenya. This figure has remained constant over a period of 5 years. These statistics could simply be translated to mean that people have little or no income at their disposal and hence may not be in a position to purchase what they need or even be able to access needful services.

Kenya is a diverse country and each region has different economic activity taking place. The entire North of Kenya is generally considered to be semi arid region and the people of these places generally engage in pastoralism as their main economic activity. The challenges in the Northern Region include water, animal rustling, severe dry spells amongst others. These challenges in many cases have contributed to severe negative repercussions on the economic livelihood. The Western Kenya is made up of the Nyanza and Western Province regions. These regions are mainly agricultural areas. The Nyanza Province is endowed with the Lake Victoria and hence has booming fishing activities save for the recent hyacinth problem. Some areas of Nyanza experience floods time and again. Whenever these happen people’s activities are affected negatively. In Nyanza there are also tea plantations.

The Coast is famous for its touristic attractions. The natural beaches, coral reefs and the vast Indian Ocean are quite a resource. This extends from Mombasa to Lamu and Malindi. As one proceeds further North there is Garsen and Tana River areas. These areas are also prone to floods amongst other problems. The Central Kenya is made up of mainly agricultural activities. It is believed that this region has a big contribution to Kenya’s economy. The Rift Valley Region on the other hand is believed to be the place that Feeds Kenya i.e. the Granary of Kenya.

The Government in a bid to reduce poverty aims at creating 100,000 jobs per year. There are many challenges entailed in job creation and hence ultimately in trying to reduce the poverty incidence in Kenya. Looking at the diversities prevalent in each Kenyan region it becomes evident that each region has strengths which can be reinforced and weaknesses that need addressing in order to ensure that entrepreneurship finds fertile ground to grow in all these regions. The government strategy for job creation therefore should aim at the entire Kenya. Looking at the possibilities of providing people with employment in their own localities.

The corporate sector in Kenya is only able to absorb less than 10% of the employable population in Kenya. This leaves out so much of the employable finding themselves jobless. Despite the gravity of this situation, something positive has emerged and that is people have started developing simple efforts and technologies to occupy themselves constructively and secondly to provide them with a means of livelihood. It is important that these small initiatives are assisted to survive if we are to create a sustainable economy and to create jobs and ultimately wealth.

The biggest challenge faced by Kenya today is to ensure that the entire economy is geared towards wealth creation. How can a subsistence economy create any wealth at all? How can it generate an aggregation of surpluses when all that is generated today is all consumed and in essence cannot be in a position to provide for all the needs in the economy? Wealth creation as has been explored above is an accumulation of an economy’s savings over a period of time. Wealth can be seen in the form of capital investment, improved infrastructure, improved access to social amenities etc. Linking this aspect of wealth creation to community based endeavors means that much has to be done.

It is a fact that the community based endeavors made by the poor are not able to transcend community boundaries and ultimately enter into the economic and the political arena. This is also experienced in Kenya where self help groups started to address a specific community need hardly survive a year.  How possible would it be to create strategies that would make these initiatives survive and ultimately contribute to this problem of wealth creation for the nation? The fact is that these initiatives are barely able to meet the subsistence needs of their members and therefore find it difficult to survive in the long run. A pure situation on the ground is that these initiatives accumulate deficits over a very long period of time. This situation depletes their working capital and ultimately the ability to accumulate wealth. Initiatives that are able to survive the capital depletion problem, may find themselves in heavy reliance to injected resources from a particular donor. These types of resources do not permit for wealth creation as they encourage 100% amortization during a particular financial period. The resources may also not be invested in any other place when idle.

It is a fact that the needs in Kenya are quite varied and there is a big need for entrepreneurs who look beyond profit appropriation to themselves but who see their role as providing for solutions for the socio economic plight facing our communities. These are the types of entrepreneurs who will concentrate on providing social benefits on one hand and ensure that the initiatives they have built survive on the other. So far, there are already many institutes surviving in this way in Kenya today. Many street children homes in Kenya and Projects addressing HIV/AIDS also survive through their own internally generated resources. These initiatives need to be encouraged in various ways. A collaboration between the government, the corporate sector and the civil society will be important to provide a conducive atmosphere for the survival of these initiatives. It is important to note that when the public is empowered through job creation; the purchasing power improves, more wealth is created in the economy, through enhanced ability to save and hence they may be able to increase their stock of tangible wealth.


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