Nairobi at a Glance
Working in Nairobi
- Nairobi is Kenya’s main business hub; however, corruption and lack of transparency can influence the work environment negatively.
- Most expats in Nairobi work as embassy staff or foreign assignees; IGOS and NGOS offer employment opportunities as well.
- Most expenditures in Nairobi will go to healthcare, housing, and schooling.
- Hiring a tax consultant can be a good idea, especially if you are drawing incomes from multiple sources.
Nairobi, at the Center of Kenya’s Economy
As the largest and most dynamic economy in East Africa, Kenya is the growth engine of the region. In turn, Nairobi is Kenya’s busiest business hub. More and more people start working in Nairobi as the labor force keeps shifting to the urban areas.
Generally speaking, however, plenty of employment in Kenya still depends on agriculture. Although the service sector contributes a far higher percentage of the GDP, most Kenyans are involved in farming or cattle-herding. Some toil at subsistence level, others work in huge agri-business operations. However, things are different for those working in Nairobi, but more on this below.
The country produces coffee, tea, flowers, fruits, and vegetables for the export market. Since the manufacturing sector is small, Kenya imports a lot of essential resources and equipment, like iron, oil, chemicals, vehicles, machinery, and consumer goods. This partly explains why Kenya has accrued a hefty foreign debt.
Many Kenyans — especially if working in Nairobi — also earn a living in the service industry. Tourism is a major field of employment, but communications is a key market, too, and one in which Kenya leads the East African community. The “mobile revolution” is transforming life in lots of African states.
Challenges and Opportunities
In recent years, Kenya witnessed a substantial GDP growth, with the work force in Nairobi playing a not insignificant role in this development. Unfortunately, Kenya is facing several challenges which could impede its economic growth.
Overreliance on exports leaves Kenya vulnerable to crises afflicting its trading partners — the Eurozone is one example. A high inflation rate in Kenya has led to rising food prices, though it seems to have stabilized for now at just under six percent.
Kenyans are apprehensive about several political issues as well. Corruption and a certain lack of transparency are issues you might be confronted with when working in Nairobi.
A more pressing concern was the presidential election in March 2013. The last electoral process in 2007 caused severe social and ethnic tensions to erupt. Violence disrupted the lives of many people, not only among those living and working in Nairobi. Fortunately, the electoral process in 2013 was largely peaceful again.
However, the Kenyan economy needs to grow yet more strongly and attract more foreign investors in order to combat widespread poverty and the huge household deficit. If the Kenyan nation can weather such potential crises, the country’s expanding economy will offer new chances to its expanding population of both locals and expats.
The Pivot of the Economy and Jua Kali
The prospect of employment opportunities makes quite a few Kenyans succumb to the lure of the capital. As mentioned above, agriculture plays a smaller role in Nairobi than in other parts of the country. However, dairy and poultry farming, and horticulture are still common job sectors, here. Nairobi is also home to the Nairobi Coffee Exchange, where the coffee harvest is auctioned off weekly to exporters.
The industry for petroleum refinement and re-export of oil-based goods is obviously located on the coast. Nonetheless, Nairobi’s manufacturing sector provides some jobs. In fact, the factories produce, for instance, cement, textiles, and processed foods. Companies like Bamburi Cement (construction materials), Unga Group (flour), and East African Breweries (beer) are some of Nairobi’s larger employers. Incidentally, neighboring Uganda has the second-highest alcohol per capita consumption in Africa (according to a WHO report), so brewing is a lucrative business in the region.
There is, too, a large informal industry, called jua kali. This expression derives from the Swahili for “hot sun”. While working in Nairobi as an expat, you will see street hawkers with makeshift open-air stalls. Jua kali is an essential source of income for the poor segment of an urban population growing more rapidly than the official labor market.
Nairobi’s Hospitality Sector Hub
For the most part, those working in Nairobi’s service sector are the driving force in the local business world. It provides for the city’s highly qualified elite, as well as the rising urban middle-class. Nairobi is a national travel and transport hub and the center of Kenya’s hospitality industry. International hotel chains like Hilton are based in the city, and Nairobi houses the headquarters of Kenya Airways. With various international trade shows hosted at the Kenyatta International Conference Centre, Nairobi is also an important destination for business travel in Africa.
Furthermore, Nairobi’s finance and real estate industries employ plenty of people. Insurance companies, large banks such as Kenya Commercial, and micro-finance organizations abound in East Africa’s commercial center. In the booming communications market — with companies such as Safaricom — numerous residents working in Nairobi address the needs of the local population. Retail, education, healthcare, and community services require an increasing number of personnel.
New Projects for an Improving Economy
To sustain economic growth, create new jobs, and provide a higher standard of living, Kenya needs to keep investing in health, education, and infrastructure, and to revamp its local travel and tourism sector. From a business and trade point of view, Nairobi must increase contact and cooperation with both countries in Africa and around the world, especially with regards to travel and jobs.
As of 2014, there are various projects in the pipeline. For example, in November 2013, work began on a new Nairobi-Mombasa railway. It is a project financed with 5.2 USD billion by the Chinese government and is expected to be completed by 2017. It is hoped the railway encourages further growth through cheaper and faster transportation, and generates employment in supporting sectors.
A refurbished road network should also come as a great relief to plenty of employees working in Nairobi. It’s not only about the boredom of getting stuck in a traffic jam. Experts estimate that hundreds of thousands of dollars per day are lost due to traffic congestion! This figure takes into account fuel costs and losses in productivity.
All these plans could be a convenient chance for foreign experts who are interested in working in Nairobi. However, you should take into account that such mega projects are mostly tackled in cooperation with Chinese businesses, which are currently making inroads into the African market.
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