Regional Market outlook on Temporary Labor
Kenya is characterized by a large presence of informal employment sector in the economy, which contributes close to 83.4 percent of the total employment. The growth of the informal job market can be attributed to poor labor regulations present in the economy, which makes it easy for people to enter and exit the market.
- The informal sector contributes close to 83.4 percent of the total employment
- Close to 88 percent of the new jobs created fall under the informal employment category and increased by 5 percent compared to the last year
- A major part of the informal sector employment lies in wholesale & retail trade and hotels & restaurants’ economic activity category, which accounts for close to 60 percent
- Transport & communication accounts for only 3.12 percent of the total informal sector
- The informal sector employment grew by 6 percent in 2017 compared to the last year, indicating the increasing adoption of informal employment across the country
- Rural areas accounted for two-third of the total jobs in the informal sector, which means that labor supply is high in rural areas
Market Overview: Uganda
The Uganda’s labor market is also majorly comprised of the informal sector, and the presence of trade unions poses a challenge for employers, as they demand for wage increment.
- The unemployment rate is low, yet the youth are the major segment forming the unemployed category
- Agriculture is the main employing sector, which contributes to 27 percent of the economy’s GDP
- Due to lack of job opportunities within the domestic country, most of the working people migrate to the Middle Eastern countries in search of jobs
- The labor market is fragmented, in terms of formal employment, where an estimation of one out of ten people falls into the category
- There are close to 52 trade unions, which has a membership of approximately 550,000 workers, which are responsible for increasing wages across various industries
- It is expected that demand will be high for forklift truck driver, warehouse operative and warehouse supervisor, as the country moves towards an efficiency-driven middle income economy by 2030
Opportunities for Consolidation of Spend
Global companies have an opportunity for consolidation of spend by bundling services, such as temporary staffing and permanent recruitment in a region. As a result, companies attain volume discount of 5–7 percent by bundling different services of HR.
- Global companies have found it challenging to bundle contingent along with permanent staffing services
- The buy-in and execution for contingent staffing is carried out by the procurement team, whereas for HR, it is directly involved in permanent staffing, hence requiring limited involvement from procurement
- The HR team have attained volume discounts of 10–12 percent by bundling contingent and permanent staffing