In both its establishment and promotion of a digital economy, Kenya is one of Africa’s leading countries. Through the use of digital finance solutions like M-PESA, such innovations are facilitating transactions and spurring trade for corporations, small and medium enterprises (SMEs), and individuals. This has improved efficiency, accessibility, connectedness, and better standards of living.
Kenya is currently leading Africa with 91 per cent mobile number penetration (Business Today). Additionally, 84 per cent of Kenyans have internet access and 85 per cent have access to a 3G network. Reduced prices for phones through various websites have made it easier to access smartphones, and with reasonably-priced data bundles, most Kenyans continue to benefit with better connection.
Safaricom - Kenya’s Largest Mobile Network - has been lauded by international development experts for its M-Pesa service, which gives millions of people access to the formal financial system and has reduced crime in otherwise largely cash-based societies. Users are able to easily deposit and withdraw money, transfer money, purchase airtime, and save money in a virtual account.
M-Pesa has also been linked to reducing levels of poverty. In a series of papers from Georgetown University, and a recent report from the United Nations, M-Pesa was noted for an increase in per capita consumption levels and lifting 194,000 Kenyan households out of poverty, promoting sustainable and socioeconomic progress that society strives for.
That is not to say that M-Pesa comes without its problems. The service is often criticised for the high cost it imposes on its often low-income users, even for small transfers.
M-Pesa has also come under recent criticism for facilitating concerning activity in the sports betting industry. Kenya has the highest number of gambling youth aged between 17 to 35 years out of all of Sub-Saharan Africa (GeoPoll). Furthermore, sports betting has not only become the most popular form of gambling but a source of livelihood for youth in a country where employment opportunities are few and far between.
It can be said, however, that a more meaningful sense of income generation is desired amongst youth. The East Africa Institute's (EAI) Kenya Youth Survey Report 2016 indicates a major entrepreneurial spirit among Kenyan youth, and a majority expressed a desire to start their own business. The digital generation has made it more possible for Kenyan youth to explore and embrace their passions and interests. The sector of young Kenyan creatives, in particular, is growing into a thriving community that often uses the internet as a platform to publish and market their work. The issue lies in the fact that a fair source of income is not always guaranteed to these youth.
In a more hopeful direction, BLAZE, an application and e-learning service recently released by Safaricom, targets youth who are riding the wave of entrepreneurialism by empowering them to “be their own boss”. Courses such as marketing and sales, financing, agriculture, and programming, are offered through the application. Users are first asked to take a test to see what their strengths and skills are, then they are asked to specify their academic background and select what they are interested in learning. Afterwards students are connected to a partnering organisation that is looking for an employee with that skill set. This is seemingly a helpful initiative that helps Kenyan youth to become more employable, however it is the current job market that remains a major obstacle.
Dr. Alex Awiti, Vice Provost of the Aga Khan University, sheds some light on this issue in an opinion piece published last week. He notes that although the economy in Kenya has expanded over the last five years, and the last 15 years has seen an increase in public spending, the growth of the job market has remained, overall, “stagnant”. Data from the EAI Youth Survey showed that 55% of youth surveyed, between 18 to 35 years of age, were unemployed (2016), and a report from the World Bank indicates that the patterns of unemployment are only continuing to worsen for Kenyan youth .
Between 1998 to 2005, the overall unemployment rate fell from 15 per cent to 12.5 per cent, while youth unemployment rose from 60 per cent to 72 per cent. In August of 2018, a lawmaker told the country’s national assembly that youth unemployment in Kenya should be declared a national disaster. Last year, the Kenya National Bureau of Statistics (KNBS) released a report revealing that nine out of every 10 unemployed Kenyans are 35 years and below; the largest unemployment rate was recorded in the age group 20 to 24. A year has passed, and the country has seen no significant improvements.
This laissez-faire job cultivation, or the BYOJ (bring your own job) strategy, as Awiti cleverly puts it, can lead to the unfair assumption that the youth have the means to create their own adequate income, which can absolve the government of major responsibility. Dr. Awiti sums it up adequately: “Exhorting youth to create their own jobs is not a job creation strategy”.
Many youth are well-qualified, educated, and experienced, but the opportunities are lacking. Most have reported spending up to four years looking for a job after completing their degree, only to remain on the internship trail. It’s not the youth who need to apply themselves to reduce unemployment rates, nor are they the ones who are at fault for it. Instead, the opportunities to find employment need serious investment and cultivation.
Hopefully, the government continues to take steps to tackle this problem, while meeting the needs of a constantly changing world. The Digital Economy Blueprint released this year by the Government of Kenya, mandates for a “nation where every citizen, enterprise and organisation has digital access and the capability to participate and thrive in the digital economy”. The reach of technology is limitless and it has the potential to change the socioeconomic climate for the better and provide a new market-place for any meaningful endeavour that one wishes to pursue, so long as it has the proper investment.
Nina Plummer and Imara Dhalla are EAI Research Assistants, respectively conducting research on early childhood development and coastal health.
