Firms in Kenya resumed hiring in November after a near-freeze in October, buoyed by the strongest private sector activity performance since the height of the Covid-19 pandemic era in October 2020.
The Stanbic Bank Kenya Purchasing Managers Index (PMI) rose sharply to 55.0 points in November, up from 52.5 in October, signalling the fastest improvement in business conditions in more than five years.
A reading above 50 signifies an improvement in private sector activity compared to the previous month.
The latest PMI shows that the rate of new hirings in November was the second-fastest in over two years, with all five monitored sectors witnessing an increase in employment since the previous month.
The sectors covered by the survey include agriculture, mining, manufacturing, construction, as well as wholesale, retail, and services.
‘When adjusted for seasonal variation, the Employment Index recorded in above-50 territory for the tenth consecutive month in November, indicating another rise in staff numbers at Kenyan companies,’ wrote Stanbic in its latest release.
‘Moreover, the rate of job creation was the second-fastest in over two years. All five monitored sectors saw an increase in employment since the previous month.’
In October, a panel of around 400 companies drawn from the surveyed sectors had kept their payrolls unchanged, with more than 97 percent of firms reporting no growth in staffing levels during the month.
The PMI data shows that last month, firms responded to improving demand conditions after months of caution, lifting recruitment as workloads picked up and exerted pressure on existing teams.
November’s improvement was anchored in a strong rise in business sales and output, which grew at their fastest pace since October 2020 on the back of improved customer purchasing power and softer inflation.
Firms also cited more effective marketing campaigns, new product launches, and increased customer referrals as additional drivers of the sharp recovery in sales volumes.
‘Volumes of new business rose for the third consecutive month in November, with the pace of expansion climbing to a sharp rate that was the most pronounced in just over five years,’ Stanbic noted.
‘All sub-sectors experienced growth, as companies highlighted improved client purchasing power, successful marketing strategies, increased referrals, and the launch of new products.’
The rise in output input followed months of subdued growth earlier in 2025, when weak household spending and expensive materials, coupled with the effects of new taxes, kept many firms on the defensive.
Input purchases rose at the fastest rate since mid-2020, reflecting the confidence with which firms are approaching the final quarter of the year.
This came as input prices rose only slightly, marking the weakest pace of cost increases in 18 months as price pressures from raw materials and logistics continued to ease.
‘(Input) purchase prices and staff costs both increased at historically subdued rates,’ the PMI report reads.
The easing of cost pressures, paired with rising sales, allowed companies to rebuild buffers and expand operations more confidently after spending much of the year tightly managing cash amid tough economic conditions.
Despite the improved performance, business optimism for output in the next 12 months softened for the third straight month, reflecting lingering concerns over higher taxation, uncertain consumer spending, and the impact of global economic headwinds.
‘Looking ahead to the next 12 months, Kenyan companies maintained a generally positive outlook for private sector output. However, this optimism softened for the third consecutive month since August’s recent high,’ wrote Stanbic.