A debate raging in the United Kingdom over raising the minimum wage for young workers has cast a spotlight on Kenya's own severe youth unemployment crisis. A review led by former UK health secretary Alan Milburn is examining whether higher wage floors could price young people out of crucial entry-level jobs, a concern that resonates deeply in a nation where the youth unemployment rate is alarmingly high.

This discussion is not merely academic for Kenyans. With the Federation of Kenya Employers (FKE) reporting that 67% of young people aged 15-34 are unemployed, the question of how to create jobs without imposing prohibitive costs on businesses is a matter of national urgency. The UK's dilemma serves as a critical case study for policymakers in Nairobi.

A Cautionary Tale from Abroad

In the UK, economists and even some political allies are cautioning the Labour party against its pledge to equalize the minimum wage for all adults. The core argument, as noted by think tanks like the Resolution Foundation, is that in a fragile economic environment, mandating higher pay for less experienced workers could deter businesses from hiring them altogether. Milburn warned of creating a "lost generation," a fear that is already a reality for millions in Kenya.

The economic logic is straightforward: if an employer has to pay a higher mandatory wage, they may opt for an older, more experienced worker over a young person who requires training. This dynamic could worsen what is already a dire situation for young Kenyans entering the labour market.

The Kenyan Context: A Delicate Balance

Kenya's labour market is a complex tapestry of formal and informal sectors, with the latter providing the vast majority of all employment opportunities. The government, in partnership with employer and worker unions, navigates a tricky path on wage policy. The most recent 6% increase in the general minimum wage, effective November 1, 2024, brought the monthly rate in cities like Nairobi to KES 16,113.75. This was a compromise figure after the Central Organisation of Trade Unions (COTU) pushed for a much larger hike to offset inflation, while the FKE argued for moderation to protect jobs.

Unlike the UK, Kenya's labour laws focus more on age-based restrictions for hazardous work rather than tiered minimum wages for different youth age brackets. The debate here is less about varying youth rates and more about the overall impact of any minimum wage increase on the fragile job market.

• Staggering Youth Unemployment: 67% of Kenyans aged 15-34 are unemployed.
• Recent Wage Increase: A 6% general minimum wage hike was implemented in November 2024 after tripartite discussions.
• Employer Concerns: The FKE consistently warns that sharp wage increases could stifle job creation and push businesses to relocate.
• Worker Demands: COTU argues that wage increases are essential for cushioning workers against the high cost of living.

The Path Forward

While COTU Secretary General Francis Atwoli has welcomed recent wage adjustments as a step towards improving livelihoods, employer federations remain cautious. They stress that a conducive business environment is the ultimate engine for job creation. As Kenya strives to absorb over one million young people who enter the labour market annually, the lessons from the UK's debate are profound. Policymakers face the challenge of protecting workers' welfare without inadvertently closing the door on the next generation. The ultimate goal remains finding a sustainable policy that puts food on the table for everyone, especially the young.