In Summary
  • Going by real income, the share of employees in the formal workforce who fall within the middle class, those presently earning between Sh76,894 and Sh109,324, have increased minimally.
  • According to economists, a strong middle class provides a stable consumer base that drives productive investment.
  • The formal sector employs about 2.4 million Kenyans or 17 per cent of the labour force.

Real monthly incomes have stagnated since 2010, a review of employment data reveals.

In 2010 the real average monthly income was Sh31,212 but it dropped by one per cent to Sh30,862 in 2014 finds the analysis by Nation Newsplex.

Real wage is the income of an individual after taking into consideration the effects of inflation and purchasing power.

A person earning the average wage has to work for 23 minutes to afford a 2kg packet of Unga

For example, if you got a three per cent salary rise over the previous year and inflation for the year was two per cent then your real income only rose one per cent. Inversely, if you received a two per cent raise in salary and inflation stood at four per cent then your real income would have shrunk two per cent.

However, in nominal terms, the monthly wage increased from Sh32,963 in 2010  to Sh46,265 in 2014, a rise of 40 per cent.

A person earning the average wage has to work for 23 minutes to afford a 2kg packet of Unga, which costs about Sh110, while an individual who is in the lowest wage bracket, earning  Sh9,999, has to work for at least one hour and 42 minutes to buy the same packet of Unga. Someone earning the minimum amount within the highest wage bracket, Sh100,000 can buy the same packet after working for 11 minutes.

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