Structural transformation, population change and sectoral employment in Kenya: 1964-1976

Abstract

Structural change generates major differences in the rates of growth of economic sectors in the production system, and hence in sectoral share s in produc t and 1abour force (employment) • The major aims of this study was to examine the effect of changes in income, population, wage and capital formation on sectoral en~loyment and output; and the impact of structural change on the relative dominance of the various economic sectors in tenns of their contribution towards a number of economic variables. The maj or findings of the study are that: structural change affects the relative dominance of the sectors, with relative importance of agriculture in both the production and employment sector dirrunishing over time; population change with the implied changes in population characteristics does not significantly affect employment in any sector, implying that changes in composition of consumers' demand due to population growth is a weak factor in promoting sectoral employment; the effect of wage rate (cost of labour) on sectoral employment differs depending on the specific sector under consideration.