Over the past few years, youth unemployment in Kenya has escalated into a national crisis, particularly affecting those under 35 years of age.
Despite the positive growth in the economy, reflected in real gross domestic product (GDP) terms, unemployment rates among this demographic continue to rise.
It is important to note that these figures may not fully capture the true extent of unemployment, as they exclude individuals who are not actively seeking work, such as discouraged workers or those engaged in informal employment.
According to the Kenya National Bureau of Statistics (KNBS), while the formal sector added 127,200 jobs in 2022, this was inadequate to accommodate the growing number of graduates.
University enrolment has steadily increased, reaching 579,050 students in 2023, yet about 35 percent of young people between 18-34 years remain either unemployed or underemployed. This age group, comprising 16 million individuals, represents 29 percent of the population.
Given these alarming figures, it is clear that youth unemployment is a ticking time bomb.
The National Youth Service (NYS), with its training and service focus, has long been an underutilised asset. But with the right restructuring, it could become the driving force behind providing meaningful employment opportunities for Kenya’s young population.
By enhancing NYS’s commercial linkages and operations, Kenya can turn the tide against rising youth unemployment. The recent Gen Z protests highlight that Kenya faces an acute youth unemployment crisis.
According to the 2024 KNBS Economic Survey, 53.1 percent of individuals aged 18-35 years are deprived of economic activity.
Furthermore, 72.4 percent of youth below 35 years are classified as multi-dimensionally poor, exacerbating socio-economic disparities.
One of the most pressing challenges lies in the quality and nature of employment available to the youth. Kenya’s employment landscape has shifted towards more precarious forms of work, including casual labour, contract work, and outsourcing.
These arrangements often strip workers of basic rights like collective bargaining, paid leave and access to social protection.
If left unchecked, this shift toward temporary and insecure work could severely undermine Kenya’s national competitiveness and productivity, stifling job creation and deepening the youth unemployment crisis.
A review of the NYS 2018-2022 strategic plan revealed significant gaps in employability promotion.
The lack of formal agreements with potential employers, coupled with weak coordination between the employment and training departments, has hindered the transition of NYS graduates into the job market. It is clear that without significant restructuring, the NYS will continue to fall short of its potential as a job creation engine.
The proposed solution revolves around three core strategies to address Kenya’s youth unemployment crisis: increasing employment opportunities, improving job quality and enhancing social security offerings for workers.
One of the primary proposals is the establishment of sector-targeted subsidiaries under the NYS. The subsidiaries would be mandated to handle at least 30 percent of government tenders, providing a guaranteed stream of economic opportunities for Kenyan youth.
For example, according to the Private Security Observatory Organisation, the Private security industry has about 1,000 operating entities, and directly employs more than 500,000 people, with an estimated annual turnover of over Sh300 billion.
Let’s assume that 30 percent of these jobs are in partnership with NYS Security Ltd (for example), this would lead to 150,000 jobs and Sh100 billion in revenue annually. It’s important to note that they estimate a further 300,000 people are informally employed in this industry.
The scale of Kenya’s youth unemployment demands a large-scale response. With 53.1 percent of the 16 million youth aged 18-35 underemployed, approximately nine million jobs need to be created. If an average salary of Sh20,000 per month were provided to both urban and rural populations, the total monthly payroll would amount to Sh180 billion, with an annual payroll of Sh2.16 trillion.
In its first year, the initiative could target 500,000 jobs, requiring a monthly payroll of Sh10 billion, or Sh120 billion annually. Although the current NYS budget stands at only Sh11 billion, these sector-targeted corporations could unlock significant revenue through their commercial activities, reducing the need for external financing over time.
To support the initiative in its early stages, the introduction of an Unemployment Fund Levy through Paye could generate significant additional funds.
Moreover, while not a long-term solution, technical assistance (e.g. donor funding capacity building) could help bridge the gap until the NYS subsidiaries become self-sustaining. The purpose of this levy will be used to create jobs through the NYS investment corporation.
This corporation will offer training for various business sectors both formal and informal, with a percentage of guaranteed jobs opportunities by the government and informal sectors. Private companies supporting the NYS corporation can benefit from tax reliefs. Current initiatives like ‘Kazi Mtaani’ can be piloted under NYS.
The potential for commercial revenue is substantial. Since 2018, Kenya has published over 25,000 contracts worth Sh577 billion on the Public Procurement Portal. If NYS Group could secure 30 percent of these contracts, it would generate Sh225 billion in revenue, supporting the creation of 250,000 jobs.
The private sector also offers opportunities, particularly in industries such as security, where the NYS could collaborate with private companies to secure additional contracts.
For this initiative to succeed, key legal frameworks will need to be amended. This includes revising the NYS Act to expand the scope of activities and establish its sector-targeted subsidiaries.
Amendments to the Public Procurement and Disposal Act (PPDA) would mandate that 30 percent of government and public corporation tenders be awarded to NYS subsidiaries. Additionally, changes to the Public Finance Management Act (PFM) and Employment Act, will be necessary to ensure that the initiative is both financially viable and compliant with labour regulations.
Kenya can look to successful global models for inspiration. Singapore’s National Youth Council has established numerous programmes to empower youth through leadership training, career readiness, and community engagement.
Having served in the inaugural pre-university NYS cohort of 1984 and being honoured as the best serviceman of my cohort, I carry with me fond memories and a passion for the success of the programme.
I appeal to the Government of Kenya to prioritise the modernisation of the NYS programme, taking into consideration the proposed model in this article. By doing so, we can enhance recruitment efforts and address the pressing issue of unemployment more effectively.
Kenya’s youth unemployment crisis requires urgent action. By transforming the NYS into a dynamic engine for job creation and economic development, the government can unlock the potential of Kenya’s youth and drive sustainable growth.
Through targeted legal reforms, strategic economic incentives, and strong partnerships with the private sector, the NYS can be restructured to provide meaningful employment opportunities, ensuring that the country’s youth are not left behind in Kenya’s economic future.
The Principal Act needs to be amended in section 2 to include the definition of “National Youth Service Corporations” and the inclusion of National Youth Service Corporations in the list of reserved and preferential groups highlighted under section 157 (4) of the Principal Act.
A proposal needs to be made to amend the Principal Act to specifically include National Youth Service Corporations within the existing mandate under section 157 (10) which requires every procuring entity to allocate at least thirty per cent (30%) of its procurement value in every financial year to the youth, women, and persons with disabilities.
To make the National Youth Service (NYS) uniforms in Kenya more appealing to Gen Z, a thoughtful redesign should incorporate contemporary fashion trends and practical elements that resonate with younger individuals.
The current uniform can be updated by integrating modern, versatile fabrics and styles that align with current trends, that offer both comfort and functionality.
Additionally, adopting a more vibrant colour palette and incorporating popular design elements, like subtle logos or patterns, can make the uniform more stylish and relevant.
By making these changes, the NYS can become more attractive to Gen Z recruits, potentially increasing enrolment and participation. The commercial subsidiaries of NYS are to be exempted from the State Corporations Act Cap 44 to enable them to be operationally competitive.
Global Best Practices: Learning from Singapore and South Africa
Meanwhile, South Africa’s National Youth Service Programme engages young people in community service and vocational training, promoting national pride and economic participation.
Dr Hosea Kili, OGW
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