Multinationals turn to Kenyan professionals, cut expatriate staff
This trend suggests that multinationals are relying more on Kenyan professionals while cautiously expanding their local workforce after the disruptions caused by Covid-19.
Kenya’s workforce in foreign-backed companies is becoming increasingly local as multinational firms reduce reliance on expatriate staff, a new government survey reveals.
The 2024 Foreign Investment Survey (FIS) shows that expatriate employees in firms with foreign investments fell by 12.52 per cent to 3,502 in June 2024 from 4,003 the previous year, while local staff continued to dominate the payrolls.
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The decline mostly affected expatriates on short-term contracts, whose numbers dropped 22.35 per cent to 1,525 from 1,964 in June 2022.
Those on long-term contracts also fell, but only slightly, by 3.04 per cent to 1,977.
“The number of foreign employees declined, with those on short-term contracts decreasing by 22.4 per cent and those on long-term contracts by 3.0 per cent in 2024,” the report noted.
Despite the reduction in foreign staff, local employment in these firms grew by 3.62 per cent to 221,267 workers, the slowest increase in three years.
This trend suggests that multinationals are relying more on Kenyan professionals while cautiously expanding their local workforce after the disruptions caused by Covid-19.
The FIS highlights that Nairobi continues to be a major hub for investment in Africa, hosting both global companies and a growing number of start-ups attracting billions of shillings from private equity and venture capital funds.
In 2023, foreign direct investments (FDIs) into Kenya rose 28.92 per cent to Sh242.61 billion from Sh188.19 billion in 2022. ICT led the inflows at Sh64.67 billion, followed by wholesale and retail at Sh48.31 billion, finance and insurance at Sh45.32 billion, and manufacturing at Sh32.46 billion.
The report also points out differences with the United Nations Conference on Trade and Development (UNCTAD) figures, which estimated Kenya’s 2023 FDIs at $1.504 billion (about Sh194 billion). Unlike the FIS, UNCTAD focuses mainly on greenfield projects, infrastructure finance, and large multinational production activities.
To further boost investments, Kenya is collaborating with UNCTAD to develop a one-stop online platform for investors.
Once operational, the platform will integrate national and county business registration systems, easing regulatory processes and providing faster access for both domestic and foreign investors seeking to set up operations in Kenya.
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