Unemployment and Population Growth Rate

Topics: Unemployment, Population growth, Economics Pages: 5 (1322 words) Published: April 1, 2013
Unemployment is a growing problem in Kenya especially among the youth and has been the election agenda for almost every politician in the last few election and still continues to be. It might not be able to look at the solution available to the issue of unemployment without looking at the causes of the unemployment as this will give us a peek into what we are dealing with. Causes for the unemployment in Kenya.

High population growth rate:

The rapid population growth rate in Kenya is generating rapid growth in the labour force. Such a high population growth rate is incompatible with the available arable land in the rural areas. Hence people tend to migrate in the urban areas in search of jobs. This aggrevates unemployment in the urban areas. This problem can be overcome by reducing the high population growth rates using methods used to control population growth.

Use of inappropriate technology:

For developing countries, this is the situation whereby industries continue using relatively capital intensive methods of production instead of labour intensive ones. This is caused by relative factor prices of capital and labour, foreign ownership of firms, etc. This problem can be solved by the creation of incentives to encourage the of labour intensive techniques.

Lack of Co-operant Factors:

This is especially so in the case of capital and skilled labour, which are scarce in most developing countries. Such a problem can be solved through increased capital formation and expanded education and training.

Capacity Under-utilisation:

Most firms tend to produce below their capacity, thereby not employing as many people as their capable of. This arises due to lack of sufficient demand of their products. It can also be as a result of monopoly practices that limit output. This can be solved by expanding markets through, for example, export promotion and control of monopoly.

Global Economic Recession:

Recent global economic recessions have reduced the capacity of most economies to reduce unemployment. Kenya is not an exception to this. The problem can be solved through greater international co-operation. Seasonal nature of labour demand:

Demand for labour in rural areas is mostly seasonal. This is made worse by the general ignorance of the existence of jobs elsewhere as well as by occupational immobility. This creates problems of underemployment and disguised unemployment. The problem can be solved by modernising agriculture and ensuring continuous production throughout the year. Imperfections in the labour market:

There are imperfections in the labour market caused by government and trade union interventions. This has tended to distort the labour market by maintaining minimum wages above the market equilibrium. As such, the wage structure in Kenya has failed to co-odinatedemand and supply. This can be solved by allowing a free market mechanism to operate. This might require the removal of wage guidelines.

Inappropriate education system:

The education system in Kenya was preparing people for jobs that were not there. The 8-4-4 system of education is designed to try to overcome this anomally. It is intended to make people self-reliant. Regional disparities in development: The disparities in rural and urban development have tended to encourage migration of labour to towns through what is referred to as rural-urban migration.

Bridging the Unemployment Gap in Kenya
Just like in most developing countries, unemployment is a major issue of concern in Kenya. Studies indicate that unemployment in Kenya has been made worse by factors such as declining economic growth, the rapid population growth, skills mismatch and information problems in the labor market, negative effects of the structural adjustment programs (SAP), political instability, and poor governance.

In the first years of the millennium, unemployment in Kenya was made worse due to the effects of SAPs and globalization (Chanyisa 2003). The...
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