Tech companies based in Kenya have been ranked among firms that have undertaken mass layoffs across Africa since 2020.
In a report by a UK-based company, Business Financing, tech companies in Kenya sacked 844 employees between 2022 and 2023.
For instance, the highest layoff was done by Copia in July 2023 as 350 staff were sent home.
The mass layoffs were occasioned by the reduction of the purchasing power of Kenyans after the pandemic and the rise in costs of doing business.
"In fourth place comes the Kenyan e-commerce platform Copia, which laid off 350 workers in July 2023 to reduce labour costs and maximise profits.
"Twiga, another Kenyan e-commerce platform, appears twice in the list with two separate layoff events, the most significant of which occurred in August 2023 when 283 employees or a third of the firm’s workforce were laid off," read the report in part.
Overall, Nigerian-based companies experienced the most mass layoffs with a single company sacking 900 employees in November 2022.
Between 2022 and 2023, tech companies based in Nigeria laid off 1,790 employees owing to the tough economic times witnessed after the pandemic.
Notably, Business Financing projected that more companies would continue with the mass layoffs in the coming months and years.
This anticipated trend was attributed to the advancement of technology which has been characterised by the adoption of Artificial Intelligence.
"Artificial intelligence is part of it. According to one estimate, 4,600 workers have been laid off by U.S. companies since May 2023 because of AI in some way," read the report in part.
"Some companies, like Swedish fintech firm Klarna, have announced hiring freezes as they explore ways of automating work with artificial intelligence, a technology Klarna already uses to replace the work of 700 full-time human workers.
