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House prices contracted by an estimated 0.2 percent in 2020 /COURTESY

Kenya

Kenya’s Private Sector Growth Slows in August fueled by job cuts

NAIROBI, Kenya, Sept 3 – Growth in the private sector slowed in August as job numbers fell amid efforts by companies to cut wages costs.

This is according to the Markit Stanbic Bank Kenya Purchasing Managers’ Index which dropped to 53 points, down from 54.2 points recorded the previous month.

The period was marked by the growth of exports at a record rate, but job numbers fell as companies sought to cut wage costs. Notably, sentiment improved for the first time since February but remained relatively weak.

Despite the drop, Jibran Qureishi, Head of Africa Research at Stanbic Bank says the rate of growth remains solid overall.

“A second consecutive month of growth continues to indicate that the private sector is moderately emerging from the trough in April,” he said.

Qureishi added that easier curfew restrictions and ameliorating external demand continue to support purchasing activity.

However, the researcher said weaker jobs growth indicates the underlying challenges the road ahead presents, even as business confidence has improved over the past two months.

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