By Dominic Omondi, Standard Digital

There are thousands of seafarers lost in the treacherous deep-blue sea. These sailors are former Kenyan workers left to drown in the murky waters of unemployment.

The captains of the ships they were sailing in, finding it difficult to surmount the raging storm, resolved to push them overboard so the vessels could stay afloat. Not that the captains delighted in this. A few had to be sacrificed for the good of the many.

Similarly, to stay afloat, corporations this year have been forced to offload thousands of their employees as they grappled with a tumultuous business environment in what is fast turning into one of the largest labour crises since independence.

The captains (employers) insist they issued a distress call, but it is not clear if the coast guard (the Government) heard it. After all, the sea was calm, seemingly bereft of any storm.

According to the Government, there is no storm in the country’s economic waters. The economy is doing pretty well, and the business environment is at its very best. In fact, there are facts and figures to shore up this claim.

In 2015, the country’s macroeconomic environment was anything but enviable with inflation staying within the Central Bank’s target. Gross domestic product (GDP), or the country’s total output, grew by 5.6 per cent up from 5.3 per cent in 2015, according to the Kenya National Bureau of Statistics (KNBS).

The economy churned out about 824,000 jobs while total exports rose by 8.2 per cent. 2016 looked even rosier. The economy has already expanded by 6.2 per cent during the second quarter compared to 5.9 per cent during the same quarter in 2015.

And then in October came the icing on the cake. The World Bank unveiled the Ease of Doing Business report which showed that Kenya had retained its position as the third most improved country globally, thanks to a raft of regulations the Government put in place making it easier for businesses to operate. The country also continued its upward trend moving up 21 places in the ranking and joining the coveted league of top 100 countries with a favorable business environment.

But even as the Government delights in the billions of shillings being pumped into the economy and the accolade it is getting for improving the business environment, hundreds of thousands of families are wrecked by an ‘unprecedented’ loss of jobs.

This is the mystery of an economy that is growing at an impressive rate, even as the private sector —the biggest producer of jobs and contributor of taxes — is struggling to stay afloat.

Since January 2016, over twenty companies have either folded and shipped out or simply downsized leaving more than ten thousand employees without jobs. They have cited a tough business environment as their main reason.

Cement manufacturer East African Portland Cement is the latest in a long list of companies that have retrenched as a cost-cutting measure. The Athi-River based cement maker announced that it would send home about 1,000 of its workers as it sought to navigate the tough business environment.

Oserian Limited in September said it would send home 400 workers due to suppressed European market demand and high cost of production. Karuturi Flower Farm, another flower company, sent 2,600 employees packing as the flower firm shut down operations in Kenya.

Yana tyre manufacturer Sameer Africa Limited announced that it would shut down its Nairobi factory after a bruising competition from cheap tyres from China and India which left it bleeding profusely. Hundreds of jobs were lost.

Owners of Kenya Fluorspar Company also resolved to wound up operations in the country following prolonged global slump in prices of fluorspar, leaving more than 700 people in the larger Kerio Valley in the cold.

Banks have literally gotten into a new sporting game of laying-off. It is as though lenders are trying to find out who can out-do each other in retrenchment. Some analysts have noted that this is the effect of the controversial Banking Act 2016 which capped interest rates thus denying lenders the discretion to charge exorbitant interest rates. What the Government saw as an instrument to achieve financial inclusion is turning out to be a bitter pill for hundreds of bank employees.

Standard Chartered Bank sent home 167 employees in what it described as a cost-cutting measure. Also, the lender recently announced that it has outsourced non-core functions to India in a move that is expected to render some 300 employees redundant.

Equity Bank also sent home 400 employees, though it attributed it to natural attrition. Sidian Bank retrenched 108 employees. Family Bank also joined the fray, dangling the not-so-painful option of voluntary early retirement programme to its employees.

Read more: Unemployment crisis: Thousands of workers left to drown as firms fight to stay afloat

Source: Standard Digital