No. 70/2023-2024 Assessing Labour Productivity for Mombasa County By Cecilia Naeku and Esther Irungu Overview of the County Mombasa County is a member of the Jumuiya ya Kaunti za Pwani (JKP) economic bloc and hosts the country's second-largest city in the country. The county is classified as a non-ASAL county experiencing less than 10 per cent aridity levels. Mombasa County covers an area of 294.7 km² and has six sub-counties namely: Changamwe, Jomvu, Kisauni, Likoni, Mvita, and Nyali. Key Highlights The productivity of Mombasa County is characterized by the following: i. The services sector has the largest share of the county's Gross Value Added (GVA). Manufacturing has the highest share of industry GVA while transportation and storage services dominate the services sector. ii. The quality of labour requires interventions to increase secondary school enrolment rates and reduce stunting, teenage pregnancy, child poverty, and food poverty. iii. The essential infrastructure requires intervention to increase access to internet connectivity. iv. The services sector is the highest employer with the majority in wholesale and retail trade. In agriculture, employment is concentrated in fish farming. In manufacturing, employment is concentrated in textiles and wearing apparel, and food and beverages. v. Labour productivity is highest in the industry while the agriculture sector has the lowest labour productivity. To enhance productivity, there is a need to: KIPPRA Policy Brief No. 70/2023-2024 1 i. Promote urban and peri-urban farming to support food security in the county and increase agriculture productivity. ii. Leverage investing in the blue economy to create jobs and increase county output. iii. Secure the quality of labour by implementing nutritional programmes to reduce stunting and reduce teenage pregnancies through creating awareness and supporting teenage mothers to continue with education. Also, prioritize implementing 100 per cent secondary school transition rates to enable acquisition of skills. iv. Encourage investments in manufacturing to support the transformation of the agriculture sector through fish processing, agro-processing, and textile industry. This also includes supporting the County Aggregation Industry Park to enhance the productivity of the MSMEs. Mombasa County Economic Performance Mombasa County contributes on average 5.1 percent of the National Gross Value Added with an average GVA of Ksh 385,755.6 million. The GVA per capita for Mombasa County is Ksh 319,254.03 with an average population growth of 2.2 per cent and overall poverty levels at 31.8 per cent. Mombasa County has shown a steady growth in GVA with an average growth rate of 4.42 percent in 2013-2022, which is higher than the national average growth of 4.37 percent. The highest growth rate was in 2021. Figure 1: Mombasa County GVA growth rate 10.00 9.31 7.45 8.00 5.35 5.95 5.60 6.19 6.00 4.75 5.29 5.10 3.99 4.39 4.46 4.27 4.65 3.60 3.64 4.00 2.00 0.42 0.00 2014 2015 2016 2017 2018 2019 2020 2021 2022 -2.00 -3.31 First County Government Regime Second County Government Regime -4.00 Years Mombasa National Average Data source: KNBS 2023-Gross County Product Sectoral Analysis of GVA The services sector is dominant in Mombasa County with an average contribution to GVA of 65.52 per cent. The industry sector is second, contributing an average of 33.74 per cent to the GVA while the agriculture sector is very low at about 0.71 per cent (Figure 2). KIPPRA Policy Brief No. 70/2023-2024 2 Overall GVA Growth Rate Figure 2: Contribution of broad sectors to Mombasa County GVA 100% 90% 80% 70% 62.66 64.17 65.06 65.57 65.22 67.42 67.81 66.83 66.87 63.57 60% 50% 40% 30% 20% 36.65 35.13 34.35 33.88 34.13 31.89 31.09 32.36 32.29 35.59 10% 0% 0.69 0.70 0.59 0.54 0.65 0.69 0.73 0.80 0.84 0.84 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 First County Regime Second County Regime Year Agriculture Industry Service Data source: KNBS 2023-Gross County Product The average growth rate of agriculture GVA in 2013-2022 is 11.47 per cent, which is below the national average of 12.71 per cent (Figure 3). Figure 3: Mombasa County agriculture GVA growth rate 40.00 32.78 30.00 23.46 18.27 20.00 15.6612.74 15.0612.41 14.39 12.42 8.92 9.94 15.75 9.84 10.39 10.00 5.10 6.05 0.91 0.00 -6.44 2014 2015 2016 2017 2018 2019 2020 2021 2022 -10.00 First County Government Regime Second County Government Regime Years Mombasa National Average Data source: KNBS 2023-Gross County Product Agriculture sector The agriculture sector in Mombasa County is very small with fishing as the most common practice. Crop production in the rural areas and urban farming is also common. Maize production is still predominant although the growing of high-value vegetables and fruits is KIPPRA Policy Brief No. 70/2023-2024 3 Agriculture GVA growth rate Contribution of Broad Sectors to County GVA being promoted. The area under maize production has generally declined over the years while maize production is erratic (Figure 4). Figure 4: Maize production and area under maize production 800 1200 700 1000 600 800 500 400 600 300 400 200 200 100 0 0 2012 2013 2014 2015 2016 2017 2020 Axis Title Harvested Area (HA) Production (MT) Data source: National Information Platform for Food and Nutrition (NIPFN) Livestock production is on a small scale. The most common livestock is meat goats and beef cattle (Figure 5). Poultry farming is also practiced and highly diversified with broilers as the most common poultry type. Milk, poultry meat, and eggs have the highest economic value among the livestock products. KIPPRA Policy Brief No. 70/2023-2024 4 Maize Production (Metric tonnes) Area under maize production (Hectarage) Figure 5: Livestock production statistics 70.00 60.00 58.48 60.00 50.00 47.66 50.00 40.00 35.80 40.00 30.00 30.00 20.00 16.53 18.52 20.00 10.00 10.00 7.13 5.59 5.33 3.46 0.00 0.64 0.85 0.00 Livestock type Poultry type 160.00 139.55 140.00 120.00 114.76 100.00 89.62 80.00 60.00 53.72 40.00 23.63 20.00 1.85 1.83 0.29 0.28 0.00 Milk Beef Goat Mutton Poultry Honey Eggs Hides Skins meat Livestock Product Data source: National Information Platform for Food and Nutrition (NIPFN) Industry Sector The average growth rate of the industry sector is 8.36 per cent, which is below the national average of 10.58 per cent (Figure 6). KIPPRA Policy Brief No. 70/2023-2024 5 Total Value (Ksh.million) Percentage of Livestock Percentage of Poultry Figure 6: Mombasa County industry GVA growth rate 20.00 17.67 18.00 16.51 16.00 14.00 12.37 12.12 11.52 1121..4875 11.93 12.00 10.60 10.00 8.47 8.02 8.59 8.00 6.04 6.21 5.51 6.00 5.66 3.52 4.00 1.40 2.00 0.00 2014 2015 2016 2017 2018 2019 2020 2021 2022 First County Government Regime Second County Government Regime Years Mombasa National Average Data source: KNBS 2023-Gross County Product Manufacturing is another important sector in Mombasa County as it dominates the industry sector as shown in the Figure 7. Figure 7: Contribution of industry sub-sectors to the industry sector GVA 100% 90% 20.07 23.57 26.55 27.50 28.66 33.85 80% 36.182.24 42.63 42.90 41.02 1.95 70% 11.98 1.74 1.78 1.13 14.68 10.39 10.52 60% 14.52 1.10 1.01 10.04 8.36 1.02 1.00 0.88 6.30 6.00 5.56 50% 40% 30% 65.71 59.81 61.32 60.20 55.69 55.00 54.45 50.05 50.10 52.54 20% 10% 0% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 First County Regime Year Second County Regime Manufacturing Electricity supply Water supply; sewerage, waste management Construction Data source: KNBS 2023-Gross County Product KIPPRA Policy Brief No. 70/2023-2024 6 Contribution of sectors to Industry GVA Industry sector GVA growth rate Services Sector The average growth rate in the services sector is 9.35 per cent, which is below the national average of 11.13 per cent. Figure 8 : Mombasa County services sector GVA growth rate 20.00 16.33 14.64 15.00 13.66 13.04 13.07 13.26 12.46 1100..6398 11.38 11.16 9.46 9.79 10.39 10.00 8.62 5.00 1.82 0.90 0.00 -1.98 2014 2015 2016 2017 2018 2019 2020 2021 2022 -5.00 First County Government Second County Government Regime Regime Years Mombasa National Average Data source: KNBS 2023-Gross County Product The transportation and storage sub-sector, dominates the services sector with the highest contribution to service GVA at 33.02 per cent (Figure 9). The wholesale and retail trade sub- sector is the second highest contributor to services GVA at 17.48 per cent. The real estate activities sector is third at an average of 16.37 per cent. KIPPRA Policy Brief No. 70/2023-2024 7 Service sector GVA growth rate Figure 9: Contribution of sub-sectors to services sector GVA 100% 2.35 25..2396 52..3188 52..1147 52..1281 52..0888 42..1764 42..1553 26.11 4 ..3178 2.446.40 15.81 15.51 15.84 16.28 16.48 16.34 16.10 17.31 16.56 17.43 12.43 13.09 14.37 15.09 14.02 12.75 12.08 13.19 13.68 15.92 50% 33.44 35.02 34.29 33.79 32.96 33.90 35.10 33.33 33.22 25.16 17.50 17.40 17.40 17.02 17.43 16.69 17.05 17.98 17.52 18.79 0% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 First County Regime Second County Regime Other service activitieYsear Human health and social work activities Education Public administration and defence Administrative and support service activities Professional, scientific and technical activities Real estate activities Data source: KNBS 2023-Gross County Product Quantity and Quality of Labour Force in Mombasa County Mombasa County has a total of 792,072 working-age population, which is about 65.55 per cent of the total county population (Table 1). Most of the working-age population is youthful (18-34 years) at 56.47 per cent. Table 1: Distribution of the working-age population by age categories Working age Male Female Total Percentage of total working population age population (%) 15-17 27,984 30,074 58,058 7.33 18 -24 83,382 99,026 182,408 23.03 25-34 131,180 133,665 264,845 33.44 35-64 160,216 126,545 286,761 36.20 Total 402,762 389,310 792,072 Data Source: KNBS (2019), Kenya Population and Health Census - KPHC 2019 Most of the population in Mombasa sub-counties are persons in the working age categories. Changamwe has the highest Percentage of working-age persons at 68.23 per cent (Table 2). KIPPRA Policy Brief No. 70/2023-2024 8 Contribution of sectors to service GVA Table 2: Sub-county land area distribution of working age population by age category Sub-county Total Working age population categories Working population age population (15-64) as a 15-17 18 –24 25 –34 35-64 Percentage of the total sub-county population Changamwe 131,882 5,773 18,995 30,991 34,221 89,980 (6.42) (21.11) (34.44) (38.03) (68.23) Jomvu 163,412 7,564 22,898 36,072 37,853 104,387 (7.25) (21.94) (34.56) (36.26) (63.88) Kisauni 291,924 14,610 43,240 63,448 65,719 187,017 (7.81) (23.12) (33.93) (35.14) (64.06) Likoni 250,354 11,987 40,487 57,432 51,518 161,424 (7.43) (25.08) (35.58) (31.91) (64.48) Mvita 154,166 8,355 23,788 27,184 43,461 102,788 (8.13) (23.14) (26.45) (42.28) (66.67) Nyali 216,565 9,769 33,000 49,718 53,989 146,476 (6.67) (22.53) (33.94) (36.86) (67.64) Data source: KNBS (2019), Kenya Population and Health Census - KPHC 2019 Mombasa County has high-performance socioeconomic indicators that affect the quality of labour. However, interventions are required to increase secondary school enrolment rates and reduce stunting and teenage pregnancies (Table 3). Table 3: Human capital indicators Human capital indicators County National average Literacy rate 94.70 78.41 Pre-primary net enrolment rate (2019) 80.06 67.51 Primary school net enrolment rate (2020) 67.40 77.72 KIPPRA Policy Brief No. 70/2023-2024 9 Secondary school net enrolment rate (2020) 31.90 54.18 Average years of schooling (2014) 9.20 7.78 Percentage of children 12 -23 months fully vaccinated 78.60 74.97 (%) Percentage of stunted children 13.50 19.75 Percentage of teenage pregnancy 10.80 15.79 Primary to secondary transition rates (2020) 86.40 86.13 Pupil-teacher ratio (primary school) 24.00 28.28 Food poverty headcount (%) 29.30 33.63 Child poverty headcount (%) 32.20 42.67 Data source: KNBS (2022), Kenya Demographic and Health Surbey - KDHS 2022; KNBS (2019), Kenya Population and Health Census - KPHC 2019; Ministry of Education (2020; 2021 Basic Education Statistical Booklet; KNBS 2021-Kenya Poverty Report Mombasa County performed higher than the national average for essential infrastructure indicators (Table 4). Table 4: Essential infrastructure and other resources indicators Essential infrastructure indicators County National average Percentage of households with access to electricity 85.90 38.52 (2019 Census Distribution of population using the internet (2019 39.20 18.69 Census) Rural Access Index (2018) 95.12 63.72 Access to improved sanitation (2018) 86.00 59.04 Access to improved water (2018) 82.60 65.33 KIPPRA Policy Brief No. 70/2023-2024 10 Financial inclusion level (2021) 89.80 81.01 The proportion of primary schools with internet 51.10 27.65 Proportion of secondary schools with functional internet 63.60 35.13 Percentage of households by housing material 94.28 51.71 composite-finished materials(adequate) (2019) Per cent age of households using bank usage (overall) 56.10 38.18 Percentage of households using mobile money 88.60 78.58 Data sources: KRB 2018, KPHC 2019, FinAccess 2021, KIHBS 2015/16 County Employment Statistics The employment-to-population ratio is at 52.10 per cent. Most of those working are youthful (18-34 years) at about 28.17 per cent while those 35-64 years are at 23.57 per cent. The Percentage of those employed by gender is 41.33 per cent for males and 28.63 per cent for females. The unemployment rate is relatively high at 17.65 per cent and higher for the youth (18-34 years) at 11.68 per cent and those aged 35-64 years at 5.63 per cent. The Percentage of persons between 5-7 years old working is 1.44 per cent indicating that the county has low levels of child labour. Table 5: Garissa County employment statistics Employment statistics Youth Non-youth Employment to population ratio (%) 28.17 23.57 Unemployment rate 11.68 5.63 Percentage of persons 5–17 years old working 1.44 - Inactivity rate 16.18 12.27 Data source: KNBS (2019), Kenya Population and Health Census - KPHC 2019 Sectoral Employment The services sector is the highest employer in Mombasa County at 70.22 per cent followed by the industry sector at 27.08 per cent (Figure 10). The agriculture sector is third at 2.70 per cent. KIPPRA Policy Brief No. 70/2023-2024 11 Figure 10: Percentage of persons employed in the broad sectors 80.00 70.22 70.00 60.00 50.00 40.00 30.00 27.08 20.00 10.00 2.70 0.00 Services Industry Agriculture Broad Sectors Data source: KNBS (2019), Kenya Population and Health Census - KPHC 2019 Agriculture Sector In the agriculture sector, the majority are those practicing fishing/fish farming (Figure 11). Figure 11: Percentage share of employment in agriculture sub-sectors 1.4 1.21 1.2 1.04 1 0.8 0.6 0.4 0.24 0.2 0 Fishing/fish farming Crop Production Mixed Farming Agriculture sub-sectors Data source: KNBS 2021- Kenya Continuous Household Survey Industry Sector The majority of those working in the industry sectors are in construction (Figure 12). KIPPRA Policy Brief No. 70/2023-2024 12 Percentage share of Percentage of persons employed in the broad employment sectors Figure 12: Percentage share of employment in the industry sectors 70.00 60.00 57.23 50.00 40.00 37.20 30.00 20.00 10.00 4.35 1.21 0.00 Construction Manufacturing Water supply; Electricity, gas, steam sewerage, waste and air conditioning management and supply remediation activities Manufacturing sub-sectors Data Source: KNBS 2021- Kenya Continuous Household Survey A disaggregation of employment in manufacturing shows that the majority of those employed in the sector work in low-technology manufacturing sub-sectors such as manufacture of textiles and wearing apparels and manufacture of food and beverages (Figure 13). Figure 13: Percentage share of employment in manufacturing sub-sectors 60.00 50.64 50.00 40.00 30.00 20.52 20.00 10.58 10.00 5.09 4.77 3.11 2.74 2.54 0.00 Textiles and Food, Manufacture Manufacture Manufacture Printing and Repair and Manufacture wearing beverages of fabricated of chemicals of basic reproduction installation of furniture apparel and tobacco metal and metals of recorded of machinery products products, chemical media and except products equipment machinery and equipment Manufacturing sub-sectors Data source: KNBS 2021- Kenya Continuous Household Survey Services Sector Employment KIPPRA Policy Brief No. 70/2023-2024 13 Percentage share of employment Percentage share of employment The majority of those working in the services sector are in wholesale and retail trade, and repair of motor vehicles and motorcycles (Figure 14). Figure 14: Percentage share of employment in the service sector Professional, scientific and technical activities 0.72 Financial and insurance activities 1.00 Public administration, defense and compulsory social security 1.18 Real estate activities 2.06 Human health and social work activities 2.97 Other service activities 5.06 Administration and support activities 5.89 Accomodation and food service activities 6.99 Education 7.75 Transportation and storage activities 11.74 Activities of households as employers 13.37 Wholesale and retail trade and repair of motor vehicles and motorcycles 41.27 0.00 5.00 10.0015.0020.0025.0030.0035.0040.0045.00 Percentage share of employment Data source: KNBS 2021- Kenya Continuous Household Survey In the wholesale and retail trade, and repair of motor vehicles and motorcycles, the majority work in other retail not in stalls, stores or markets (Figure 15). Figure 15: Per cent age of persons employed in the wholesale and retail trade, and repair of motor vehicle sub-sectors KIPPRA Policy Brief No. 70/2023-2024 14 Service sector Wholesale on a fee or contract basis 1.47 Wholesale of food, beverages and tobacco products 1.68 Retail sale of other household equipment in specialized stores 1.84 Retail sale of food, beverages and tobacco products 3.61 Other specialized wholesale 4.69 Retail sale of other goods in specialized stores 9.13 Retail sale via stalls and markets 10.42 Wholesale and retail trade and repair of motor vehicles and motorcycles 10.88 Retail sale in non-specialized stores 11.79 other retail sale in specialized stores 18.01 Other retail sale not in stalls, stores or markets 26.50 0.00 5.00 10.00 15.00 20.00 25.00 30.00 Percentage share of employment Data source: KNBS 2021- Kenya Continuous Household Survey In the transportation and storage sub-sector, the majority of those employed are in freight transport by road (Figure 16). KIPPRA Policy Brief No. 70/2023-2024 15 Wholesale and retail trade sub-sectors Figure 16: Percentage share of employment in the transportation and storage sub- sectors Freight air transport 2.34 Postal and courier activities 3.11 other passenger land transport 7.20 Water transport 9.01 Support activities for transportation 11.14 Urban and suburban passenger transport 23.93 Freight transport by road 43.27 0.00 5.00 10.0015.0020.0025.0030.0035.0040.0045.0050.00 Percentage share of employment Data source: KNBS 2021- Kenya Continuous Household Survey Labour Productivity Labour productivity1 for Mombasa County is higher than the national average (Figure 17). Figure 17: Labour productivity ratios (millions) 1.00 0.91 0.80 0.60 0.40 0.35 0.20 0.00 Mombasa National Average County Data source: Author’s computation using KNBS 2023-Gross County Product and KNBS 2021- Kenya Continuous Household Survey The industry sector had the highest productivity, followed by the services sector, while the agriculture sector had the lowest labour productivity (Figure 18). 1 The measure used is the apparent labour productivity measured as gross value added per person employed. KIPPRA Policy Brief No. 70/2023-2024 16 Labour Productivity Transportation and storage sub- (Millions) sectors Figure 18: Labour productivity by sectors 1.40 1.31 1.20 1.09 1.00 0.80 0.60 0.40 0.34 0.20 0.00 Industry Services Agriculture Broad Sectors Data source: Author’s computation using KNBS 2023-Gross County Product and KNBS 2021- Kenya Continuous Household Survey Agriculture Sector Maize productivity as measured by maize yields has been fluctuating over the years (Figure 19). The average yields for the eight (8) years under review is 0.58 MT/HA which is lower than other counties within the same aridity classification. Figure 19: Maize yield (MT/HA) 1.20 1.09 1.00 0.85 0.78 0.80 0.60 0.52 0.45 0.480.41 0.40 0.20 0.10 0.00 2012 2013 2014 2015 2016 2017 2018 2020 Year Data source: National Information Platform for Food and Nutrition (NIPFN) Industry Sector Electricity, gas, steam, and air conditioning supply and manufacturing sectors had the highest labour productivity in the industry sector (Figure 20). KIPPRA Policy Brief No. 70/2023-2024 17 Maize Yield (MT/HA) Labour Productivity (millions) Figure 20: Labour productivity by industry sectors 7.00 6.42 6.00 5.00 4.00 3.00 2.00 1.74 0.97 1.00 0.30 0.00 Electricity, gas, steam Manufacturing Construction Water supply; sewerage, and air conditioning waste management and supply remediation activities Industry Sectors Data source: Author’s computation using KNBS 2023-Gross County Product and KNBS 2021- Kenya Continuous Household Survey Services Sector Financial and insurance activities sub-sector had relatively higher labour productivity when compared with other sub-sectors within the services sector (Figure 21). KIPPRA Policy Brief No. 70/2023-2024 18 Labour Productivity (millions) Figure 21: Labour productivity in services sectors Administration and support activities 0.27 Education 0.32 Wholesale and retail trade and repair of motor vehicles and motorcycles 0.44 Accomodation and food service activities 0.54 Other service activities 0.71 Human health and social work activities 0.80 Transportation and storage activities 2.96 Professional, scientific and technical activities 3.22 Public administration, defense and compulsory social security 3.71 Real estate activities 8.41 Financial and insurance activities 14.21 0.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00 Labour Productivity (millions) Data source: Author’s computation using KNBS 2023-Gross County Product and KNBS 2021- Kenya Continuous Household Survey Key Messages i. The services sector is dominant in Mombasa County's gross value added. The industry sector share is a substantive sector. Agriculture is small with highly diversified poultry farming. Manufacturing has the highest share of industry while transportation and storage services dominate the services sector. ii. The indicators of quality of labour performed within the national averages. However, interventions are required to increase secondary school enrolment rates and reduce stunting, teenage pregnancy, child poverty, and food poverty. iii. The essential infrastructure indicators are higher than the national average. Interventions are however required in internet connectivity. iv. The services sector is the highest employer with the majority in wholesale and retail trade, with employment concentrated in other retail not in stalls, stores, or markets. In agriculture, employment is concentrated in fish farming. The majority of those working in the industry sectors are in construction. In manufacturing, employment is concentrated in the manufacture of textiles and wearing apparel, and the manufacture of food and beverages. v. Labour productivity is higher than the national average. The industry sector had the highest productivity, while the agriculture sector had the lowest labour productivity among the broad sectors. KIPPRA Policy Brief No. 70/2023-2024 19 Service Sectors Policy Recommendations i. Promote urban and peri-urban farming to support food security in the county and increase agriculture productivity. ii. Leverage investing in the blue economy to create jobs and increase county output. iii. Secure the quality of labour by implementing nutrition-sensitive social protection programmes to tackle stunting, child poverty, and food poverty. Also, prioritize reducing teenage pregnancies through creating awareness and supporting teenage mothers to continue with education. Also, implement 100 per cent secondary school transition rates to enable the acquisition of skills. iv. Encourage investments in manufacturing to support the transformation of the agriculture sector through fish processing, agro-processing, and textile industry. This also includes supporting the County Aggregation Industry Park to enhance the productivity of the MSMEs. KIPPRA Policy Brief No. 70/2023-2024 20 Acknowledgment The authors acknowledge the special contributions and guidance provided by Dr Rose Ngugi (Executive Director, KIPPRA) throughout the entire process of preparing the county brief. Appreciation also goes to Fridah Njiru for the assistance in compiling data for the brief. KIPPRA Policy Brief No. 70/2023-2024 21