The Gig Economy

The Economy of Kenya is growing fast, and analysts say that this is only the beginning for developing economies. In Kenya, recent research from Mercy Corps shows that this growth is fueled in part by mobile, internet and smartphone penetration. The strong growth of Kenya’s mobile market (51 million subscriptions) and internet access (16.6% penetration, representing roughly 8.3 million users) has catalyzed the emergence of online platforms. So too has the proliferation of mobile money in Kenya. Mobile money platforms have become the second most-used payment channel in Kenya after cash, with over 784 million mobile money transactions amounting to over US $20 billion as of 2019.

The gig economy’s growth is also being driven by a burgeoning youth population looking for work. Kenya is experiencing a “youth bulge,” with approximately 20.1% of its population between the ages of 15 and 24. This ratio of youth is above the world’s average of 16.2% and sub-Saharan Africa’s average of 19.7%. With so many young people requiring employment, innovation and adaption in the job market is key – in Kenya, only 17% of the working population is formally employed. Those between the ages of 15-34 years account for 84% of the unemployed population.

Gig work is gradually changing the nature of how Kenya’s workforce accesses jobs, shifting the source of work opportunities from informal labor to digital platforms. And as with most internet-propelled technologies, gig platforms have the potential to grow even faster. Currently, the Kenyan online gig economy is valued at $109 million, and it employs a total of 36,573 gig workers. In the next five years, it is predicted to grow at an annual rate of 33%, with the total size of the gig economy reaching $345 million and employing 93,875 gig workers by 2023.

In Kenya, ride-hailing apps and online professional workers comprise the lion’s share of the gig economy both in value and workers, and are valued at $45 million and $55 million respectively. Online rentals and matchmaking platforms connecting blue-collar workers with employers account for $5 million and $3 million respectively.