The Star (Nairobi)

19 June 2014

Kenya: FKE Says Job Cuts Likely Due to Security Concerns

KENYA is staring at possible mass layoffs if the deteriorating confidence in State security is not urgently restored, the employers' umbrella body warned yesterday.

Federation of Kenya Employers said the effects of persistent insecurity which has greatly affected the tourism is now being felt in other sectors of the economy.

The Kenya Association of Hotel Keepers and Caterer representative to the FKE board Mike Macharia said about 300,000 direct and indirect jobs are estimated to have been lost over the last four weeks when the impact was most pronounced.

He said the industry was nonetheless still collecting and evaluating data on jobs from its members.

"The impact on jobs could be greater when you consider all sectors involved in the entire supply chain," he said at a press conference, citing food suppliers as most affected.

Macharia is also the vice chair of a 14-member National Crisis Management Committee appointed by Tourism Cabinet Secretary Phyllis Kandie through a gazette notice published on April 25 "to advise and co-ordinate" government's responses to mounting security threats on the struggling sector.

The industry was from yesterday due to start holding talks with trade unions to thrash out a formula to avert looming mass layoffs, he said.

One of the proposals, he added, would be to have some workers take structured leaves pending a return to stability.

Statistics from Kenya Tourism Board showed the sector's earnings dropped for the second year in a row to Sh93.97 billion in 2013 from Sh96.02 billion in 2012, and far below 2011's Sh97.9 billion.

Kandie on April 25 blamed the dip in tourist arrivals on advisories against non-essential travel by governments of traditionally source markets mainly from the West over mounting concerns of insecurity that has recently hit Nairobi and the Coastal region - the fulcrum of the industry.

FKE warned the ripple effect of insecurity will spread to other sectors if not firmly and decisively dealt with through an inclusive national dialogue.

Additional security expenditures by businesses, FKE chairman Linus Gitahi said, would lead to a rise in the operation costs with staff layoff as one of remedial actions.

"We need firm, informed and decisive action from the government," FKE said in a statement issued after a press conference in light of the deadly Sunday night's attack on civilians and businesses at Mpeketoni trading centre in Lamu - one of Kenya's top tourist destination. "It's not in the best interest of the government for information to reach the public that several warnings on terror attacks have been shared with security agencies without concrete action and proactive response from them."

President Uhuru Kenyatta on Tuesday directed immediate interdiction and subsequent prosecution of local security chiefs on alleged failure to act on intelligence in their possesion.

FKE called for thorough investigation to "expose and firmly deal" with root causes of spiraling pointers of security lapses.

"Until such investigations are done, we must avoid alarmist and speculative statements that will further heighten tension," the employer body said.

It further condemned rallying calls by the opposition Cord party to declare July 7 a public holiday in complete disregard of artilcle 9(3) of the constitution if the government fails to convene a national dialogue with them.

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