Kenyan businesses resumed hiring in June after a brief pause a month earlier, as recovering customer demand and mounting workloads forced companies to expand their workforce despite output remaining under pressure.
The latest Stanbic Bank Kenya Purchasing Managers' Index (PMI) shows employment increased at a moderate pace during June after slipping slightly in May, marking a return to job creation across the private sector.
The renewed hiring reflects growing pressure on businesses to expand capacity as new customer orders picked up for the first time since February, signalling that firms are beginning to prepare for stronger activity ahead.
The latest Stanbic Bank Kenya Purchasing Managers' Index (PMI) shows employment increased at a moderate pace during June after slipping slightly in May.
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"Kenyan companies increased their employment numbers at a moderate and above-average pace at the end of the second quarter. In many cases, job creation was linked to an uplift in new work and renewed capacity pressures," the PMI report said.
The survey shows businesses added staff even as overall output contracted for a fourth consecutive month, highlighting growing confidence that improving demand will be sustained over coming months.
Employment growth followed a modest decline in May, when firms reduced staffing as weakening customer demand forced many businesses to postpone recruitment and trim operating costs.
The turnaround suggests companies are becoming less concerned about immediate demand conditions and are, instead, positioning themselves to handle a growing pipeline of incoming work. Survey respondents reported that new business expanded in June after three consecutive months of decline, ending the weakest stretch for customer demand since late last year.
The recovery in sales orders coincided with the fastest accumulation of outstanding business since October 2019, indicating firms were increasingly struggling to clear incoming workloads within existing capacity.
Supplier delivery times also deteriorated for the first time since January 2025 as firms encountered product shortages and transport delays that slowed procurement of production inputs.
Rising backlogs often encourage businesses to recruit additional workers as companies seek to improve production schedules, shorten delivery times and prevent customers from shifting orders to competitors.
The return of recruitment comes after several months in which Kenyan businesses remained cautious about payroll expansion due to subdued consumer spending and slowing economic activity.
Many firms had instead relied on existing employees to absorb fluctuating workloads while delaying permanent recruitment until clearer signs of demand recovery emerged.
The renewed recruitment also comes as employers continue balancing rising labour costs against pressure to remain competitive in a business environment characterised by cautious household spending.
Businesses continued reporting higher operating costs arising from fuel prices, transport charges and input costs, factors that remain significant constraints on profitability.
Business confidence, however, improved in June as firms expressed greater optimism about activity over the coming year, supported by expectations of stronger demand and expansion opportunities.
