With the prevailing tough economic conditions, Youth unemployment in Kenya has risen to an estimated at 12.23%. This is according to a World Bank report that was released last year.
This is pretty high as compared to our neighbors Uganda and Tanzania whose rates stood at 4.5% and 3.49% respectively as at the end of 2023. The fact is that the economy as it is currently cannot be able to create enough jobs for Kenya’s working population.
As we all know, Kenya’s formal sector doesn’t create enough jobs and so the majority of job seekers turn to the informal (jua kali) sector to earn a living either through employment or entrepreneurship. The informal sector is essentially a lifeline for a majority of Kenyans and in 2023, employment in the sector stood at 16.7 million people. Which accounts for 83% of the total people who are employed in Kenya.
In as much as the informal sector is the biggest employer, we find that business owners in this sector have a unique set of problems that limit their growth. These issues have meant that most businesses stay small and therefore do not create additional jobs.
One of the main problems that these businesses face is lack of access to finance. This largely stems from the lack of formal business registration and record keeping. Which makes them risky to lend to ensuring that banks won’t touch them.
It is this realization that has seen a number of banks through their CSR arms come up with various programs aimed at upskilling the youth. These programs are aimed at ensuring that these youthful entrepreneurs are equipped with the necessary skills that can them to set up their own businesses, earn a living and even employ others.
One of the banks which is running such a program is KCB under the KCB Foundation with the program dubbed 2jiajiri. 2jiajiri is cleverly coined from the Kiswahili word tujiajiri meaning ‘let’s employ ourselves’. The program was launched in launched in March 2016 with the underlying theme of the program being to support young people through training, apprenticeship and funding.
The program runs in three phases that is inception which includes training, incubation which includes business support services and provision of no interest loans and maturity which includes market linkages.
Since inception, the program has created over 119,000 jobs with 22,959 youth having received technical and entrepreneurial training. With Ksh. 259 million disbursed as loans to enable youth to set up their business enterprises through provision of capital. It aims to create at least 1.5 million direct and indirect jobs while helping to set up 30,000 businesses over the next five years.
With plans to extend the 2Jiajiri program to Tanzania, Uganda, Burundi, Rwanda, South Sudan and DRC. The program is bound to have an even bigger impact in the African continent.
Absa Bank also has a similar program targeted at upskilling the youth dubbed Ready To Work which was launched in 2015. The program enables the youth to build the skills they need to make a smooth transition into the job market as well as build sustainable businesses.
The program assists youthful entrepreneurs to cover all the bases required as they choose a line of business. As well as how to set up and grow you’re their business.
The Absa program targets to impact one million youth by 2025 and has so far empowered more than 250,000 young people.