The hospitality industry in Kenya showed remarkable improvement in December and January 2021 after a big slump in May 2020 at the height of the pandemic. According to a survey done in January 2021 by the Central Bank of Kenya, 97 percent of hotels sampled throughout the country said they were operating compared to only 35 percent of hotels in May 2020.
The hospitality sector was one of the hardest-hit sectors last year. It posted an 83.3 percent contraction in the second quarter of 2020 compared 12.1 percent growth in the same period in 2019. Operations in the hotel sector started picking up after the easing of covid19 restrictions. Half of the respondents interviewed in the central bank survey said that they expect their businesses to return to pre-covid levels of operations in 2021.
Workers in the hospitality industry got some relief as the rate of employment in the sector continued to recover toward pre-covid19 levels. The employment rate in the hotel industry averaged 57% in January 2021, compared to 53% in November and 37% in May 2020. Hotels in Nairobi recorded lower rates of employment at 51% compared to hotels outside Nairobi with an average employment rate of 63%.
“This recovery reflects the easing of COVID-19 restrictions and increased compliance with health protocols,” said the Central Bank report.
Local guests were the main support in the hotel industry as foreign clients reduced due to travel restrictions and economic decline in countries around the world. Kenyans accounted for over 84 percent of the total clientele for accommodation services and 79 percent of the clientele for restaurant services in the period between 20th December and 21st January.
Bed occupancy rate continued on an upward trajectory to average at 26 percent in December 2020 compared to 23 percent in November 2020 and 10 percent in May. Hotels in Nairobi had a slower bed occupancy recovery compared to hotels outside Nairobi.
Hotel owners expressed optimism about a strong recovery of the industry once the virus is under control. According to the report by the Central Bank of Kenya, hoteliers called on government to offer “subsidies, tax reductions and suspension of some levies to support a faster recovery of the sector.”
