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Kenya's labour market is undergoing a significant transformation, shaped by a youthful population, the dominance of the informal sector, and evolving government policies.
As of 2025, the country’s population stands at 57 million, with 80% under the age of 35, presenting both opportunities and challenges for job creation.
Labour Force Overview
Kenya’s labour force reached 25.5 million in 2023, with the largest age segment being 25–29-year-olds at 3.4 million.
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The employment-to-population ratio was 63.4% in Q4 2022, and the labor force participation rate for individuals aged 15–64 stood at 69.1%.
The overall unemployment rate for this group was 5.6% as of Q4 2022. Youth unemployment remains a key issue, with the 20–24 age group facing a 15% unemployment rate.
Additionally, 14.7% of young Kenyans aged 15–34 fall under the not in education, employment, or training (NEET) category, not in education, employment, or training.
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The informal sector continues to dominate, with 16.7 million people engaged in informal employment compared to 3.3 million in the formal sector.
Sectoral Contribution to Employment
The informal sector provides the largest share of employment, particularly in wholesale and retail trade, hotels, and restaurants, employing over 9.32 million people.
Key employment-driving sectors include:
Agriculture: Supports the majority of rural employment.
Hospitality: Recorded a 21.5% quarterly GDP growth rate.
Manufacturing and Construction: Offers job creation potential, but requires policy support to expand.
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Government Interventions
The government, has introduced several initiatives to stimulate job creation:
Agricultural Productivity & Food Security
Distribution of 7.4 million bags of subsidized fertilizer to lower farming costs and enhance food security.
Aimed at boosting rural employment in agricultural value chains.
Climate Resilience and Environmental Conservation
The Climate WorX Mtaani initiative, launched in September 2024, employs thousands in climate resilience projects. Workers earn Ksh500 per day for two-week shifts, with plans for national expansion.
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Labor Migration Strategy
Agreements signed to export labor, including 3,000 Kenyan bus drivers to Germany.
One million Kenyan workers are expected to be placed abroad by 2025, including in Denmark.
The goal is to increase remittances and upskill the workforce.
Challenges Facing Youth Employment
Despite government intervention, key structural issues persist such as
Youth unemployment among 20–24-year-olds remains above 15%.
Underemployment is prevalent, with many youths in low-paying jobs below their qualification level.
Urban-rural employment disparities continue, with urban areas hosting most formal jobs.
Gender gaps persist, with young women facing higher unemployment rates and barriers to employment.
Immediate and Scalable Employment Solutions
To bridge employment gaps, the government has introduced several measures.
Scaling Up Agricultural Support
The government has expanded fertilizer access and training on modern farming techniques.
Expanding Public Works
The Ministry of Environment has also Scaling Climate WorX Mtaani and other infrastructure-focused projects to create labour-intensive jobs.
Promoting Digital Employment
The Ministry of ICT has Invested in digital literacy and remote work training.
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The government is also encouraging partnerships in freelancing, IT, and business process outsourcing (BPO).
Agriculture as a Job Creation Engine
Kenya’s agricultural sector presents a wide array of job creation opportunities, spanning several sub-sectors critical to both local consumption and export.
In crop production and horticulture, the country’s favorable climate supports the cultivation of high-value fruits, vegetables, and flowers, which are in demand locally and internationally.
Livestock and dairy farming also offer promising avenues for employment, particularly through the development of improved animal breeds that can enhance meat and milk production.
The fisheries and aquaculture sector is gaining momentum, with expanding fish farming initiatives, the establishment of cold storage facilities, and the scaling up of fish feed production.
These efforts support the growth of Kenya’s blue economy and create numerous job openings.
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Agro-processing industries are central to value addition and employment.
These include textile processing linked to cotton farming, fruit processing for juices and dried products, and a range of cottage industries producing honey, peanuts, herbal products, and more.
Other emerging areas include the manufacturing of animal feed, large-scale poultry development, dairy processing plants for cheese and yogurt, cold storage infrastructure, and rice and fish feed processing facilities.
These sectors offer diverse employment opportunities such as farm laborers, agronomy experts, and agri-tech professionals skilled in mechanization and equipment operation.
There is also growing demand for technicians in processing plants, logistics and supply chain specialists, marketers in agribusiness, and researchers driving innovation in climate-smart and sustainable agriculture.