What you need to know:
- Business leaders from sectors including manufacturing and financial services say they will be focusing on talent management in 2024.
- Firms are now appreciating the importance of talent acquisition and retention as a way of growing and sustaining their firms, which is good news for workers as it is likely to result in better pay and working conditions.
- However, despite the increased optimism, companies are sceptical on hiring more workers this year.
Talent management and reward strategy is now the top priority for Kenyan chief executives, laying the ground for talent ‘battles’ that will likely lead to improved wages and working terms for staff this year.
According to the latest chief executive officers survey by the Central Bank of Kenya (CBK), 16 per cent of business leaders from sectors including manufacturing and financial services say they will be focusing on talent management in 2024 as a strategy for growing their ventures.
The survey polled over 1,000 private sector company CEOs drawn from the financial services, manufacturing, agriculture, professional services, healthcare, tourism, hospitality, and real estate sectors among others.
This is a shift from last year’s trends, when customer-centric approach was the strategy most favoured by the business leaders to expand their operations and boost revenues.
Other drivers for business expansion, which have previously been prioritised, were this time ranked lower, among them strategic acquisitions, expansion into new markets, and effective risk management.
The change in tact means firms are now appreciating the importance of talent acquisition and retention as a way of growing and sustaining their firms, which is good news for workers as it is likely to result in better pay and working conditions.
This could offer a reprieve for staff coming at a time when salaries have decreased or remained constant for the majority of Kenyans since 2019, amid high inflation and currency depreciation that have also hit consumer purchasing power in Kenya.
The recently published Financial Services Monitor by the Old Mutual Group revealed that 62 per cent of Kenyans have had their purchasing power slashed by inflation over the last five years even as salaries remain stagnant for 29 per cent.
“This means that the majority of these consumers currently have less money in their pockets than they did prior to being impacted by the pandemic,” says the Old Mutual survey published last week.
Just 9 percent of workers have had their pay increase between 2019 and 2023, but with the rise in priority for talent strategy by companies, more workers could jump into this bracket this year.
Businesses are also increasingly optimistic this year, with 26.1 percent of CEOs now expecting the Kenyan economy to grow faster in 2024, up from just 9 percent in November last year.
At the same time, the survey reveals, 44.6 percent of the company leaders expect their businesses to grow faster this year, a more than ten percent increase compared to a similar survey last November.
The CBK’s Market Perceptions Survey published last week, however, reveals that despite the increased optimism, companies are sceptical on hiring more workers this year.