Central Bank of Kenya Survey Highlights Fourth-Quarter Hiring Pressures
A report from the Central Bank of Kenya indicated that corporate growth over the coming year will primarily be hindered by expensive business operations, high energy costs, and geopolitical conflicts, particularly within the Middle East.
At least 12.9 per cent of chief executive officers surveyed by the Central Bank of Kenya expect employment to decrease in the fourth quarter of 2026. Businesses continue to grapple with high operating costs and weak consumer demand, according to the September 2026 CEOs Survey.
The survey targeted 600 private sector firms across several industries, including manufacturing, agriculture, tourism, retail, financial services, and professional services. Between October and December 2026, the subset of 12.9 per cent of respondents expected the number of full-time employees to decrease compared with the third quarter of the year. Meanwhile, 12.2 per cent of CEOs expected employment to increase, and 74.8 per cent anticipated no change in their workforce.
Operating Costs and Consumer Demand Constraints
According to the survey results, certain enterprises might persist in restricting hiring or cutting staff numbers in an effort to control outlays. During the third quarter, employment levels remained broadly stable compared with the second quarter. However, the Central Bank of Kenya reported that some firms had reduced staff because of rising costs and subdued demand.
Businesses reported higher purchase prices, driven by increased fuel, transport, import, and other input costs. Because of market competition and constrained buyer budgets, companies found it difficult to transfer extra expenses onto buyers, keeping sales prices largely static. The central bank identified reduced consumer demand, increased taxation, regulatory challenges, and supply chain disruptions among domestic factors constraining business expansion.
Executives Expect Growth from Festive Season Spending
Chief executives displayed greater positivity regarding the 12-month growth trajectory of their organizations and the Kenyan economy compared to their outlook in July 2026, notwithstanding workforce worries highlighted in the research. Factors such as steady local demand, higher customer purchases, holiday expenditures, reduced lending rates, and expected capital inputs were cited by the Central Bank of Kenya as drivers for this enhanced perspective.
Driven by holiday outlays, hotel reservations, and community gatherings, companies anticipated a pickup in operations during the final three months of the year. Data from the poll indicated that 55.9 per cent of participants looked forward to rising demand orders, whereas 49.6 per cent foresaw greater output and 55.2 per cent expected higher sales.
Firms Prioritise Efficiency over Hiring for Growth
Nearly 75 per cent of participants forecasted steady staffing levels, indicating that the projected surge in commercial operations would not result in mass employment. The Central Bank of Kenya noted that firms expected to contain labour costs even as they prepared for higher demand during the festive season.
To foster expansion, companies focused on enhancing workflow efficiency, keeping a tight rein on expenses, integrating new technologies, and broadening their product or service lines, the polling revealed. Some firms also planned to increase marketing, introduce new products, and expand into new markets to strengthen revenue streams.
The Central Bank of Kenya conducted the survey between September 7, 2026, and September 18, 2026, to assess private sector perceptions of the business environment and economic expectations, which will inform monetary policy decisions.
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