Kenya Informal Jobs Made Up 87% of New Work in 2025
KENYA · ECONOMY
Key Facts
—What happened: Kenya added about 822,000 jobs in 2025, and 87.2% of them were informal work without contracts.
—How big the sector is: Kenya’s statistics office counted 18.1 million people working informally in 2025, up 4.1% on the year before.
—Not a one-year story: Nearly 90% of the 782,300 jobs Kenya created in 2024 were also informal, so this is not new.
—The catch: Capital FM put the 2025 job total higher, at 882,100, with a smaller informal share of 81.2%.
—The upside case: The World Bank says pro-competition reforms could lift Kenya’s yearly wage growth by up to two percentage points.
—What comes next: Kenya’s government now stresses job quality, and runs a youth training programme in 27 of 47 counties.
Kenya informal jobs made up 87.2% of the roughly 822,000 positions created in 2025. The figures come from the Kenya National Bureau of Statistics Economic Survey 2026, restated by the Treasury on Monday 31 August.
What the Kenya informal jobs numbers actually describe
The figures are not fresh. The Kenya National Bureau of Statistics, the government’s official data agency, published them in its Economic Survey 2026 on 30 April.
The National Treasury restated them at a jobs dialogue in Nairobi on Monday 31 August. The setting was the point.
The government wanted to talk about the quality of work rather than the count of it. That is a shift worth watching.
Informal work in Kenya is not a fringe. It is where 18.1 million people worked in 2025, up 4.1% on the year before.
Informal here means a job without a contract, a payslip or a tax record. It covers the market trader and the building-site labourer alike.
The sector reaches well beyond the street vendor of popular shorthand. Informal employment in construction rose 6.7% last year.
Retail trade, hotels and restaurants together account for more than half of all informal jobs. Those are labour-intensive trades rather than high-value ones.
So Kenya is adding workers faster in shops and on building sites than in the sectors that produce the most per worker. That mix tells you what kind of economy is growing.
The pattern is steady, and that is the problem
One heavily informal year could be a blip. Two years running at nearly the same ratio is a pattern.
In 2024, close to 90% of the 782,300 jobs created were informal. In 2025 the share was 87.2% of about 822,000.
The totals are respectable for an economy of Kenya’s size. What has not changed is how many of those jobs come with a contract and a payslip.
A second set of numbers does not match
The headline totals are not settled. Capital FM reported the 2025 figure as 882,100 new jobs, with an informal share of 81.2%.
That is roughly 60,000 more jobs and a noticeably smaller informal share. Neither version has been reconciled in public.
The direction of travel is clear even so. Both versions agree that most new work in Kenya comes without a contract.
From counting jobs to grading them
The government’s language has shifted. Ministers now talk about job quality, productivity and lasting employment rather than the headline count.
The government’s stated targets are 570,000 job placements and 310,000 certificates of skill. It also promises 90,000 places in technical training.
These are official targets published by the government itself. No outside body has audited them.
The vehicle is a youth scheme called NYOTA. The name stands for National Youths Opportunities Towards Advancement.
It mixes vocational training, skills development and help for young people starting a business. The government says the current phases run in 27 of Kenya’s 47 counties.
It also says nearly 200,000 young people have taken part so far. That figure, too, comes from the government.
What reform could and could not do
The World Bank has costed one route out. It estimates that pro-competition reforms could raise annual labour compensation growth by up to 2.0 percentage points.
Labour compensation is the total pay packet of the workforce. The Bank says that gain is equivalent to more than 400,000 jobs a year at current average wages.
That is a wage comparison, not a forecast of new posts. The difference matters when the number is read against about 822,000 jobs actually created.
The harder task sits underneath it. Small informal businesses have to raise their productivity, reach financing and move into the formal economy.
Each of those steps costs money the business must be able to bear. Tax policy pulls in the other direction.
Kenya’s own state think tank has warned that raising value added tax could push firms out of the formal sector. That would be the opposite of what the jobs plan needs.
Why this matters beyond Kenya
Informality is not a Kenyan peculiarity. Mexico’s informal sector drove 82% of job growth in the second quarter of 2026.
Argentina has been losing formal work outright. Across much of the developing world, job creation and job quality have come apart.
Kenya is unusual mainly in publishing the split so plainly. That openness is what lets a reader see the problem at all.
Frequently Asked Questions
How many jobs did Kenya create in 2025?
About 822,000 new jobs were created, and 87.2% of them were informal. The figures come from the Kenya National Bureau of Statistics Economic Survey 2026, restated by the Treasury in Nairobi on 31 August.
How large is Kenya’s informal sector?
The Kenya National Bureau of Statistics counted 18.1 million people working informally in 2025, up 4.1% from a year earlier. Retail trade, hotels and restaurants together account for more than half of all informal jobs.
Is this a new trend?
No. In 2024, nearly 90% of the 782,300 jobs created were also informal, so the 2025 figure extends an established pattern.
Do all sources agree on the 2025 total?
Capital FM reported the 2025 total as 882,100 new jobs, with an informal share of 81.2%. That gap with the official figures has not been explained.
What is the NYOTA programme?
NYOTA is the National Youths Opportunities Towards Advancement programme, which combines vocational training, skills development and support for young entrepreneurs. The government says its current phases run in 27 of Kenya’s 47 counties and have reached nearly 200,000 young people.
Could reforms change the picture?
The World Bank estimates that pro-competition reforms could raise annual labour compensation growth by up to 2.0 percentage points. The Bank says that is equivalent to more than 400,000 jobs a year at current average wages.
Connected Coverage
The tax side of this argument was set out when a state think tank warned that raising VAT risks driving firms informal, and the state’s own cost base is the subject of Kenya’s record cost of running government. Where the formal economy’s profits actually sit shows up in Equity Group lending outside Kenya but booking profit at home, and our pillar Africa: The New Scramble follows the money across the continent.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error
LatAm Markets: Live Signals → — real-time movers, turnover leaders and FX across Latin America.
Read More from The Rio Times