Kenyan SMEs Gear Up for Expansion: Hiring Surge Signals Optimism Amid Challenges

Written By: Flipbz.org

Kenya's small and medium-sized enterprises are showing renewed vigor, with a strong majority plotting to bolster their teams and ramp up operations, according to a revealing survey that underscores their pivotal role in the nation's economy.

A joint effort by KPMG and Business Daily spotlighted this upbeat trend among 186 Kenyan SMEs, where nearly 80% are eyeing fresh hires in the coming months—a notable jump from 68% the year before. These businesses, which pump about 30% into Kenya's GDP, are channeling investments into technology to stay ahead in a fast-changing market, reflecting solid faith in both the broader economic climate and their own sector's potential.

The findings stem from the Kenya SME contest held in July, where organizers zeroed in on the top 100 standout entries. Respondents expressed high confidence, with 77% deeming it likely or very likely they'll bring on more talent soon, fueling expectations of job creation and business scaling.

Still, the path isn't without thorns. Kenyan SMEs grapple with fierce rivalry from global players flooding the market and a chronic shortage of capital, which has led to a grim statistic: 46% of these ventures shutter within their first year. Recent policy tweaks, like scrapping the cap on interest rates last November, could ease funding woes and give these firms a much-needed lift.

Benson Ndung’u, KPMG East Africa’s Chief Executive, captured the momentum: “They have high confidence in economic outlook going forward and significant level of confidence in growth prospects within their respective industries. What this tells us is that there’s consistency when they are planning for growth and are investing in technology, and that’s what you want to see in the disruptive economy we are operating in.”

This hiring push not only highlights SMEs' resilience but also points to their growing clout as engines of innovation and employment in Kenya, provided they navigate the funding and competitive hurdles ahead.