Banks buck trend with thousands of new jobs in a tough labour market

Banks are creating thousands of new job opportunities on continued expansion, bucking the trend of layoffs and hiring freeze being witnessed in traditional job-rich sectors.

Many banks including Equity, Co-operative Bank of Kenya, and KCB are increasing their headcount by thousands, helped by growth and expansion that is manifesting in different forms, including opening up of new physical branches across countrywide.

The sector is, therefore, turning into an oasis of hope for thousands of fresh graduates joining the job market as well as experienced professionals seeking greener pastures.

KCB and Co-op Bank Kenya last week became the latest lenders to report a rise in their headcount, with both signaling newer jobs in the coming months.

Disclosures by KCB Group show that KCB Bank Kenya and National Bank of Kenya added 931 jobs last year, bringing the total headcount to 8244, out of which 5,875 were engaged on full-time basis while 2,369 were on a part-time.

The new hiring in KCB’s Kenya units was on the back of business reorganisation for growth, according to Paul Russo, the chief executive of KCB Group who says there have been over 2,000 additional hires in relationship management, sales, technology, and digital financial services in the past three years.

Mr Russo said the increase in hiring, with more lined up, “reflects areas of growth and areas of improving customer experience in relationship banking.”

Co-op Bank, which last year added eight new branches, joined KCB in creating new jobs. The bank hired an extra 536 employees and is lining up an additional 15 branches this year, which will still require more workers—a sign that those seeking jobs as tellers or relationship managers would be on the lookout.

“The bank continues to invest in a competitive team set to serve at existing functions and at the same time tap new growth opportunities across all areas of the business,” said Mr Gideon Muriuki, managing director at Co-op Bank.

Co-op staff numbers closed December at 5,400 compared with 4,251 five years earlier, meaning that it had added 1,149 jobs in the period its branch network had grown by 39 to 194.

The new hiring across the sector adds to the 3,667 jobs that banks had added in 2022 when they closed the year with a headcount of 36,107, according to the Central Bank of Kenya data (CBK). The new jobs could take the sector’s combined headcount above the 36,212 that was seen nine years ago.

Absa Bank Kenya was also on the list of those hiring. It added 526 new jobs last year—both permanent and contractual—as it embarked on an aggressive growth strategy anchored on diversifying its business lines.

The bank’s chief finance officer Yusuf Omari, who also doubles as the lender’s chief strategy officer, said the bulk of jobs came from new hires in asset management while newly opened branches also resulted in the creation of fresh roles. “While we are automating, there is still an element of facing the customer. With that, of course, we need to hire employees to do that job. We are looking at new revenue streams in all the strategy areas. We hired a completely new team in asset management and the custodial business. We have also grown jobs in bancassurance while our new Eastleigh branch added 15 staff,” said Mr Omari.

A CBK survey released in January 2024 capturing the sentiments of chief executive officers shows that banks were more optimistic about hiring this year as opposed to non-bank sectors. The survey showed that while 28 per cent of the surveyed CEOs from banks said they will ‘definitely” hire, just seven per cent of their non-bank counterparts said they planned to increase their headcount this year.

A further 50 per cent of CEOs drawn from banks told CEOs they will “probably” employ more people this year while 31 per cent of non-bank CEOs gave the same response. And while 19 per cent of bank CEOs said they “probably won’t” add jobs, 47 per cent of non-bank CEOs said so.

The risk of losing jobs this year is also very low in the banking sector, with only three per cent saying they will “definitely” cut jobs. This is in contrast with 15 per cent of non-bank CEOs who say they will certainly retrench staff this year.

This will mark a continuation of the hiring for the banking sector, cementing its position in the economy in terms of creating jobs and catalysing growth in other sectors through credit.

NCBA Group’s unit in Kenya added 471 jobs in 2022 and also promoted 471 existing staff. Its headcount is expected to continue growing given that it had indicated that it was going to add 11 new branches last year.

DTB Kenya in 2021 added 382 jobs while I&M Group’s unit in Kenya added 58 in the same period as Equity Bank Kenya hired 538 more.

With eight new branches opened in December last year, DTB’s workforce is expected to have grown last year. I&M Bank in January this year also opened eight new branches in the country and said it was planning to add 12 more this year, signaling that more hiring is on the way.

The staff retention rate in the banking sector is high, averaging above 90 per cent for many banks, an indication that employees are staying longer. Kenya National Bureau of Statistics (KNBS) data has consistently ranked the financial services sector as the second-highest paying sector in the country after international non-governmental organisations like the UN.

KNBS data showed the financial sector, comprising banks, insurance firms, and investment companies paid their staff a monthly salary of Sh170,433 in 2021, which represented a 1.8 per cent or Sh3,072 increase from 2020.

Even for the few banks not growing staff size, the competitive package has been attractive to the current employees. Standard Chartered Bank of Kenya, for instance, has not been growing its staff size but its staff costs have been bulging, a scenario chief executive Kariuki Ngari attributes to pay rises.

“We are paying salaries and there is inflation. At any given time you are adjusting for inflation. If you look at Kenya in the last couple of years, you have seen how inflation numbers have been and so you have to keep adjusting to pay competitive salaries. We believe we pay competitive salaries,” said Mr Ngari.

Many of the staff staying with the same employer within the banking sector are also finding the sector the best bet in enjoying pay rises that shield them from inflation-adjusted pay cuts that workers in many other sectors have had to contend with.

Bank early 2021 got a four per cent basic pay increase backdated for the period between March 1, 2020, and February 28, 2021.

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