In a striking revelation, a recent Old Mutual report has highlighted a concerning economic trend in Kenya, with 70% of Kenyans reporting a significant decline in their income levels throughout 2024. The findings paint a bleak picture of the financial stability of a majority of the population and underscore the ongoing challenges faced by households across the country.
The report, which surveyed a cross-section of Kenyan citizens from different income brackets and regions, indicates that many families have struggled to maintain their standard of living due to inflation, job losses, and the rising cost of essential goods and services. As Kenya grapples with economic pressure, particularly from high food prices, soaring fuel costs, and the depreciating local currency, many citizens have found themselves making tough financial choices.
The overwhelming 70% of respondents indicated a noticeable drop in their earnings compared to previous years. A significant number attributed this decline to either job loss, reduced working hours, or underemployment. Small business owners, particularly in sectors like retail, hospitality, and transport, have also reported lower profits as consumer spending has slowed.
Nearly all respondents expressed frustration over the rising cost of basic commodities, such as food, fuel, and transport. The report notes that inflation has particularly hit low and middle-income households the hardest, forcing them to either cut back on non-essential spending or take on additional debt to meet their needs.
Among the youth, the situation is even more concerning. The report found that unemployment rates have worsened, with young people struggling to find steady work. This group has faced setbacks in both formal and informal sectors, with many having to take on freelance or gig work, which often does not provide long-term financial stability.
Many respondents reported increased reliance on loans and credit to cope with their day-to-day expenses. For a large portion of the population, the mounting debt has led to anxiety and financial insecurity, as individuals struggle to manage monthly repayments while dealing with diminished incomes.
Several key factors have contributed to the worsening economic situation. These include the global impact of the COVID-19 pandemic, which caused long-lasting disruptions to the economy, and local challenges such as poor agricultural yields, which have impacted food supply chains. Additionally, the Kenyan shilling’s depreciation against major currencies has compounded the cost of imports, contributing to higher prices for goods and services.
The global economic slowdown has also affected Kenya’s key industries, including tourism and export trade. With fewer international tourists visiting Kenya, and disruptions in global supply chains, these sectors have struggled to recover fully.
The Old Mutual report urges both the Kenyan government and the private sector to take proactive steps in alleviating the financial strain on citizens. Economists have called for policies that support job creation, encourage investment in key sectors, and improve financial literacy to help Kenyans better manage their personal finances during tough times.
The report also emphasizes the importance of building a resilient economy, one that can weather external shocks and internal disruptions. There is a call for increased investment in technology, infrastructure, and education to ensure that the younger generation has the skills to compete in a rapidly changing job market.
While the outlook for Kenya’s economy in 2024 remains uncertain, experts are hopeful that strategic interventions can help stabilize the financial landscape. Citizens are encouraged to explore alternative income sources and investment opportunities, including saving and building financial buffers to mitigate future economic hardships.
In conclusion, the Old Mutual report serves as a stark reminder of the economic struggles many Kenyans are facing, urging policymakers and stakeholders to prioritize financial relief and long-term economic recovery strategies. With inflationary pressures and income reductions still top of mind for many, there is a growing need for action to ensure that Kenyans can regain their financial footing and move toward a more secure future.
