Third Eye

Firms should protect jobs amidst Covid war

Monday, December 7th, 2020 00:00 |

The country’s economy has been severely battered by the Covid-19. Businesses have been closed while more than 1.72 million workers lost their jobs due to the lockdown imposed to fight the pandemic.

Data from the Kenya National Bureau of Statistics shows the number of people in employment fell to 15.87 million compared to 17.59 million during the first months of the pandemic.

According to the bureau, youths were the hardest hit by job cuts compared to those aged over 35 years.

The job market  has been plagued by closure of companies and countrywide curfew that reduced the duration of doing business.

The survey indicates that nearly 4.64 million people were jobless at the end of June, up from 2.94 million at the end of March.

Those left on duty have had to endure painful salary cuts to sustain themselves as their organisations strive to regain their footing.

 President Uhuru Kenyatta last week launched a three-year post-Covid socio-economic recovery strategy for counties.

The Sh132 billion recovery plan prioritises agriculture, water and sanitisation, urban development and housing, transport, tourism, health, education, social protection, and gender and youth empowerment. 

The President pointed out that the strategy is expected to drive growth and economic rebound in counties.

We appreciate indications that the Treasury was keen to pay pending bills to various companies in support of the recovery strategy and cushion jobs. But we are concerned by the announcement by Treasury Cabinet Secretary Ukur Yatani that taxes cut during the start of the pandemic will revert to normal from January 1, 2021, although low earners will continue enjoying a 100 per cent tax exemption.

According to the CS, the move was necessitated by the ease of some of the containment measures and subsequent resumption of normalcy.

We believe that even with the ease containment measure there is no evidence that many businesses have recovered and thousands of employees on pay cuts still require protection. That is why we advise the minister to rethink the position.  

Companies still require State support as they struggle to recover. Even then,  we encourage companies which have been on a spree releasing employees to the streets due to the effects of the pandemic to come up with more innovative ways to create and protect jobs.

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