Determinants of Employment in the Formal and Informal Sectors of the Urban Areas of Kenya

"By applying a multinomial logit model and economic theory to labour force survey data, this study examines the determinants of formal and informal sector employment in the urban areas of Kenya. The findings show that the determinants of employment in public, private and informal sectors of Kenya’s urban labour market vary by age cohort and gender. Special emphasis is placed on the importance of sex (being male rather than female), marital status, household-headship and education variables, of which the first three illustrate the disadvantaged position of women in the labour market. Education has the strongest impact on formal sector employment, yet most women work in the informal sector despite significant improvements in their education attainment. Two observations merit concern, high youth unemployment and gender imbalance in access to employment. Unemployment is particularly high amongst women, especially younger women. Younger women are either unemployed or employed in the inferior informal sector (in the sense of low income, precarious and unregulated forms of employment), as opposed to males in a similar age bracket who are likely to work in the private sector."