Kenyan companies hired fewer people in the month of November as compared to October as a result of a fall in demand exports.
According to the industry stats released by Stanbic Bank Kenya through the Purchasing Manager’s Index, demand for exports in November fell to 10-month low forcing firms to refrain from hiring new staff.
The PMI says that despite the fact that firms refrained from hiring people, they raised the purchasing activity during the month, making it the highest rise since the month of June.
Stanbic Bank collected data from about 400 private sector companies in Kenya. For the month of November, the overall PMI dropped from 54.0 to 53.1 with the sector generally registering a small increase in new businesses in 10 months.
According to the survey, the rate of accumulation in backlogs of work eased to a three-month low, indicating that weaker demand growth had reduced the pressure on unfinished orders.
During the month of November, vendor performance improved and in the process shortening delivery times for the fastest pace since the month of August. The PMI attributes this to the high competition among suppliers.
Kenyan consumers have been known to be shifting their loyalty to a service provider who treats them well and delivers to them what they want on time. The current consumer is impatient and always wants what he/she orders to be delivered almost immediately and will, at 90 percent probability, shift to another service provider if the service is delayed.
According to Stanbic, the PMI that is above 50.0 is an indication of an improvement in the private sector conditions from diverse sectors such as agriculture. If the PMI is below the 50.0 marks, is an indication of the deterioration of the same.
Kenya’s economy has been going through an economic and financial turmoil with various companies issuing profit warnings and some being placed under administration.