Kenya’s construction sector suffered a shrinkage in the third quarter of 2024, sparking fears over the broader economy.
Latest data from the Kenya National Bureau of Statistics shows the industry suffered a 2.0 per cent contraction during the period under review, a sharp fall from the 4.0% growth registered in the corresponding period in 2023.
The shrinkage was reflected by a sharp decline in consumption of cement, one of the critical materials used in construction. Cement consumption in the country in the three months to October last year stood at 2,196.7 thousand tonnes, down from 2,439.7 thousand tonnes consumed in the third quarter of 2023.
In addition, the production of the galvanized sheets during the period under review stood at 68,719.5 metric tonnes, representing a 4.2 percent decline.
The sector’s slump was also defined by a 40.9 per cent decline in the amount of imported bitumen to 18,353.0 tonnes in the the quarter under review from 31,053.5 tonnes imported during the same period of 2023.
The construction industry is one of the key sectors in Kenya’s economy and one of the biggest employers in the private sector. In 2023, the industry created about 226,300 new jobs, especially for young people.
There is a strong correlation between the construction industry and economic growth. The decline in construction activities, mining, and quarrying proved to be the weakest links in Kenya’s economy, which recorded a slow growth of 4.0 percent in the third quarter of 2024.
Related: Kenya’s Q3 GDP growth slows as construction and mining sectors decline
