Topic > The Impact of Globalization on the Labor Market in Kenya

While Kenya has certainly been one of the leaders in the race towards globalization in Africa, its progress has been plagued by stops and starts that have put it in a position of disadvantage. In reality it was only in 1993 that Kenya fully integrated into the global market1. When Africa gained full independence from its colonial masters, “the global trading system remained highly inefficient, with advanced economies exploiting their technological advantage to enjoy enormous market powers: supply-side monopoly or oligopoly, and monopsony or oligopsony on the demand side. Blue Hippo).” Due to the inefficiency of the system, it has been even more difficult for Kenya to gain ground in the global economy and thus its economy has been compromised, which in turn has had a negative impact on the evolution of the labor market. Globalization To fully understand the impact of globalization on Kenya's labor market, it is crucial to illustrate what globalization is. According to the International Monetary Fund (IMF), globalization is “the integration of economies around the world through trade, financial flows, the exchange of technology and information, and the movement of people (IMF).” This increased integration and interdependence has created a complex link between the world's economies which in turn has increased each member's dependence on the global economy. This has significantly improved the investment portfolios of businesses and individuals. With new cross-border opportunities, countries continue to see larger and larger shares of their GDP coming from international trade.2. Historical View of the Kenyan Economy Once Kenya gained independence from Britain in 1963, its economy began to flourish during the period 1964-1980. Halfway through the document… “allowed unions to seek full compensation for price increases without hindrance through wage guidelines (essay).” Due to this there has been an increase in real wages in the private and public sectors. After the establishment of the trade reforms of the 1990s it was obvious that competition had increased and current employment levels were too high. Laws were later to be changed to give employers the power to fire employees more easily. This came as a result of companies saying they needed to have the power to “restructure their operations in response to the economic adjustment taking place in the country (wise)”. It was a system quite similar to at-will employment in the United States. Instead of notifying the Minister of Labor when they fire an employee, they only have to notify the district or regional labor office.