197 CEOs Plan to Layoff Staff Over High Cost of Doing Business
More Kenyans are on the verge of losing their jobs after 197 company CEOs plan to layoff workforce within the next three months.
Central Bank of Kenya (CBK) conducted a survey on 1000 company bosses across several economy sectors only to find out that 197 CEOs decry the high cost of doing business.
The 197 CEOs revealed that the layoffs would be necessary because the companies wish to tame the operational cost which has also been occasioned by high taxation and poor purchasing power among Kenyans.
“Firms which reported possible difficulty in expanding their operations cited difficulties in securing finances for working capital and high overhead costs. Other reasons cited included subdued demand.
“Some firms reported possible difficulties in expansion, particularly due to liquidity constraints, increased cost of borrowing, increased cost of production, (particularly the cost of energy), issues around taxation, and infrastructure,” read the report in part.
On the other hand, 636 CEOs revealed that they not add workforce in the bear future. This means Kenyans who are seeking employment could still have to wait for longer.
“The majority of the respondents (62 per cent) were privately-owned domestic firms, while the rest were privately-owned foreign businesses, publicly listed domestic companies and government-owned entities.
197 CEOs Plan to Layoff Staff Over High Cost of Doing Business
“48 per cent of the respondents had a turnover of over Ksh1 billion in 2023. In terms of employment, 40 per cent of respondents employed less than 100 employees, while 29 per cent of respondents employed over 500 people,” read the report in part.
In a similar survey that was conducted in January this year, 257 employees noted that they were planning to lay off some staff in the first quarter.
Report further indicated that only 106 companies would be hiring new employees.
Way Forward
To address the challenges facing this sector, the CEOs are calling on the government to adopt a more predictable taxation regime.
