Strategies for
Success
Striving for Upward Social
Mobility in Nairobi
Masters Thesis: Cultural and Social Anthropology
Graduate School of Social Sciences, University of Amsterdam Word Count: 23,014
Supervisor: Dr Rachel Spronk Second Reader: Dr Milena Veenis Third Reader: Lieve De Coninck
Student: Wanjiru Wambari-Kairu Student Number: 11287934
E-mail: wwambarikairu@gmail.com Date: 05th July 2017
For my parents. Who through their pursuit to achieve their goals, provided me with an environment where I have been free to pursue mine.
Acknowledgements
I would like to thank my class mates for providing a venting ground when writing, for both our proposals and thesis. For supporting each other from the beginning of the year, sharing knowledge as well as reading and giving feedback on each other’s work. It very much felt like were in this together, despite all doing independent research.
I would like to thank my supervisor Rachel Spronk for helping me to make sense of what was in my head and get it on to paper. During fieldwork pushing me to investigate deeper the things I had discovered and for making me feel secure in the knowledge that whilst I was there I would be able to find and speak with people who could contribute to my research.
I would like to thank all my aunts and cousins who were so supportive whilst I was in Nairobi and allowing me to a be a ‘permanent’ guest in their homes. Having home comforts whilst carrying out research was greatly appreciated and your company added to make my fieldwork a great experience.
Finally, I would like to thank my parents for supporting me in my decision to leave work and go back into studying, whilst also being a listening board when I have been planning my research and writing my thesis.
Plagiarism Declaration
I have read and understood the University of Amsterdam plagiarism policy
[http://student.uva.nl/mcsa/az/item/plagiarism-and-fraud.html?f=plagiarism]. I declare that this assignment is entirely my own work, all sources have been properly acknowledged, and that I have not previously submitted this work, or any version of it, for assessment in any other paper.
Contents Page
Abstract 1
Keywords 1
Introduction 2
Studying the Middle Class 4
Research Question 6
Conceptual Framework 6
Methodology and the Field 11
Thesis Outline 12
Chapter 1 14
The Public Debate 16
Strategies for Success 17
Education 19
The Side Hustle 22
Chapter 2 27
Strategies for Risk Mitigation 28
Insurance and Family Relations 30
Chamas and Saccos 35
Chapter 3 40
The Purpose of Symbolic Boundaries 41
Expectations to Succeed 42
Expectations to Progress 45
Epilogue 50
Conclusion 51
Abstract
Adding to the debate sparked by the Africa Development Bank in 2011, this study aims to contribute to the discussion on the middle class in Sub-Saharan Africa. The study of the middle class in Sub-Saharan Africa is still developing. However, in recent years it has become a topic of interest across disciplinarians including economics, sociology and
anthropology. This thesis focuses on social mobility in Nairobi, Kenya. Due to the increased economic development and higher levels of political stability, Nairobi has become a focus of interest to outside investors both in the public and private sector. The growing middle class in Nairobi make it an interesting focal point to study social stratification in Sub-Saharan Africa.
This thesis focuses on viewing class through a cultural lens. Looking to understand the strategies used to achieve aspirations and move up the social ladder. This thesis takes the approach used by anthropologists studying this field to look at class through a cultural lens order to under the stratification in Nairobi. The chapters within this thesis focus on the aspirations this group and what strategies they use to achieve these, how they form their social boundaries and what methods they use to protect themselves from loss of economic and material capital and downward social mobility.
Keywords
Social mobility, Navigation, Strategies, Middle Class, Risk Mitigation, Boundaries, Aspirations, Nairobi
Introduction
I was waiting for an Uber to take me to the Lavington area of Nairobi to visit my cousins. It was almost six in the evening, Friday, and it was quite warm. Nairobi in January is usually warm, with temperatures going up to 30 degrees Celsius. Despite the warmth, which I experienced as comfortable, I knew that my travel to my cousins would take me 20 to 25 minutes by car from where I lived in Nairobi. Since I had just ordered an Uber I simply had to wait at the gate of the apartment complex I lived in, for the taxi to arrive. Throughout my fieldwork, I used to follow this similar pattern, order an Uber and then make my way to the gate for them to arrive. In Nairobi, most housing estates and developments have gates and security guards manning them.
Uber has been in Nairobi since March 2015 and has become a popular method of transportation around the city. The app told me to look out for a Toyota and that my drivers’ name was Joel. The road I was living on, Muchai drive, lead onto Ngong Road and had a constant flow of traffic. Depending on the day, this could also be standstill traffic, depending on whether there were policemen at the end of the road directing the flow of cars. Because it was Friday evening the traffic was already building and the cars were moving slowly onto Ngong Road.
When Joel arrived, he greeted me and confirmed if I was indeed Wanji and if I still wanted to go to Lavington. 'This is a perfect pick for me, I was just passing here', Joel said. We would be going up Ngong Road towards Kilileshwa and using the by-pass to cross over into Lavington where my cousins lived. During the Christmas and New Year period Nairobi empties. There had been hardly any cars on the road and it is much quieter. It being the first Friday of the month the city was back to its usual capacity with children back at school and people back to regular working hours. I asked Joel if it was going to be busy that evening, he replied with; ‘Yes it will be, many requests, but you are my last client for today, I will be going to my fellowship at church after I complete this journey'. I was interested to find out more about why Joel had started working with Uber and what his experience had been like. Joel said '…Actually for 2017 I have a plan and a goal, I plan to fully own my vehicle and purchase another one so that I can have my own business…I want to be my own boss'.
He had been an Uber driver for the past year and a half and had plans to stay an Uber driver for the foreseeable future;
'I've spoken with the bank… you know Equity? I want to get a loan from them so that I can purchase this car within the next 6 months, then after that, purchase another one and hire someone to work for me as a driver… I've written a proposal and I will be presenting to them soon… You need to be prepared and present yourself well, then… you will succeed'.
I asked him if he had always been in the taxi business and he answered ‘no’, this had not been his initial career choice;
'…You are told to work hard in each stage of school, to keep focused so that you can be successful in the future, then you finish school and there is no job and so you have to find something else to do…. But it is Gods will and I will persevere with what I am doing'.
The day after my Uber ride with Joel I was having breakfast with my cousins while I was enjoying the Saturday Nation Newspaper. There was an article in the discussion section about a former Kenyan singer from the band Camp Mulla, in 2012 they had international success and were nominated at both the MTV Europe Awards and BET awards for Best African Act, who was now working as an Uber driver in Nairobi. #KOT, Kenyans on Twitter, a popular hashtag that is used to target particular conversations online, had been making fun of him for going from being a star to a taxi driver, whilst others were coming to his defence to say that work is work.
For both Joel and #KOT being an Uber driver was not a career path that should be strived for. It does not come with the status and prestige for someone who has excelled in academics and has reached a certain status level. However, in both cases of Joel and Camp Mulla, these were the jobs that they had taken on whilst aspiring for better professional opportunities. Joel, despite not expecting to work as a taxi driver, had developed a plan to make sure that he was still moving upwards. In Nairobi striving for upward social mobility is an almost palpable principle and an expectation that many Nairobians feel. This thesis is about these feelings and desires and the strategies for success that are developed.
Striving for Success
Joel was one of many Uber drivers I met during my fieldwork, despite regularly visiting Nairobi I have yet to master the matatu (local bus services) routes. Since Uber opened for service in 2015 it is one of the easiest ways to get around. It also provided the added benefit of opportunities to gain a different perspective of Nairobi life, as the taxi drivers I met often came from varying backgrounds. I had only been in Nairobi two days when I met Joel. I had been planning on starting my research the following Monday after a few days of 'settling in’, however I was intrigued by the conversation we had. His openness to tell me about his future plans and how he hoped to achieve them. Even though he was an Uber driver, he still had the choice of when to work and when not to.
Both the conversation I had with Joel and reading the article the next day on #KOT made me think about what is strived forin Nairobi and the strategies that are used to achieve ones goals. Like Joel many middle class Nairobians, no matter the occupation or family background, are all aspiring to move upwards, to build their own businesses or careers and create a solid foundation for their families.
Studying the middle class
In 2011, the Africa Development Bank (AfDB) released a Market Brief titled ‘The Middle of the Pyramid: Dynamics of the Middle Class in Africa’, which argued that there was a growing middle class in Sub-Saharan Africa and set out classifications for the varying demographics within this group. The Africa Development Bank classifies the middle class as those who have a per capita spend of between $4 to $20 per day (2011). In Kenya, the
Institute for Economic Affairs (IEA), an independent Kenyan think tank, classified the Kenyan middle class as those with a monthly salaried income of between ksh76,392 (approx. $736) and ksh102,429 (approx. $988). According to their findings in 2015 there were
272,569 people within the middle class in Kenya, which made up only 11% of the salaried population. From the perspective of the IEA class is viewed by income level attained from salaries. The data obtained from both the Africa Development Bank and IEA give an indication of the income levels of those deemed to be part of the middle class or middle income brackets. What this does not show are particular socio-economic and cultural elements of the emergence of the middle classes or the stratification that exists even within one grouping.
The publication of the AfDB article sparked an ongoing debate about the middle class in Africa. The emerging African middle class has now become of key interest to both the public and private sectors, international investors, at the local level and in academia. Despite this, the understanding of the middle class in Sub-Saharan Africa is still developing. As more research is undertaken a better picture is being built but it is still unclear who this group are and which demographics are included. Most research in this area focuses on economic factors as a sign of social stratification. Studies have tended to focus mostly on income and
consumption as a method of differentiation between the upper, middle and lower class. However, a consensus has yet to be reached on what factors are best to research and classify this group.
Mercer argues that the problem with such reports, as that from the Africa
Development Bank, is that they ‘assume a generalised ‘African’ middle class, even though members of the new global middle class, such as those in Asia and South America, are often described at the national scale’ (2014:4). Lentz also states that ‘the African middle class is characterised first by income and second by a set of assumed universal class traits’ (2014:4) and argues that by representing ‘Africa’s growing middle class as a homogenous urbanised group with predictable economic, political and consumer behaviours is problematic when we know so little about them’ (2014:4). Mercer adds that ‘in-depth studies of the emerging middle class(es) are still scarce’ (2015:2), and goes on to state that what is now considered to be middle class in Western terms is what would have previously been considered elite in Sub-Saharan Africa (2015:2). She also states that theory on the middle class has generally come from the global north and so far understanding of the global south middle class show how complicated social stratification in this area is like. Neubert contributes to the debate by stating that ‘even if we can identity a growing group in the socio-economic strata of the middle class with an interest in the same consumer goods, their lifestyles could differ considerably’ (2014:29).
Approaches to how to study the middle class have also varied. Spronk suggests the need to look at the self-identity of the group and what esteem comes with the status of being ‘middle class’. By doing so we move away from viewing this group as those who are just in between the rich and the poor (2014:98). Leichty, in his study of the middle class in
Kathmandu, took the approach of not ‘homogenize’ culture and apply western thought to social class. Instead he approached his research by looking at how cultural lives are enacted
Building from the current research of the Sub-Saharan middle class, I borrowed the approach of anthropologists studying class to look at class from a cultural lens to understand the social stratification in Nairobi. My focus was to understand what the experience of young professionals with families was like in Nairobi. I wanted to understand the aspirations of this group, what strategies they employed to achieve them (chapter one), what strategies they used to protect themselves from loss of economic and material capital (chapter two) and the social pressures and tensions that come with being part of the middle class (chapter three). The aim of this thesis is to highlight the importance of strategies to achieve upward social mobility in Nairobi. Taking the approach put forward by Leichty (2003) I tried to not view this group as one homogenous entity. I Instead focus on the experiences of this group in balancing their aspirations to move upwards whilst facing the risk of possible economic and social loss if a wrong step should be taken.
Research Questions
What strategies do people employ to pursue upward social mobility in Nairobi?
My proposal prior to the fieldwork was to investigate how the use of insurance assisted in the pursuit of upward social mobility in Nairobi. However, what I found to be more interesting was the methods used to achieve goals of moving upwards. The strategies that were
developed and how available resources were utilised to achieve this.
Conceptual Framework
Middle Class
According to Bourdieu’s theory of capital (1986), middle-class status can be acquired through accessibility to the three forms of capital; social, economic and cultural and the exchange of one to acquire another. The level of control over the three forms of capital can have an impact on choice and the way life enfolds for people. With the pursuit of upward social mobility comes the risk that if there was to be a loss in capital there is a very real possibility of downward social mobility. Lamont et al, building onto Weber’s work on class and prestige, argue that human beings are in a constant struggle over scarce resources. Therefore to ‘curb competition, they often discriminate against other groups based on their cultural characteristics, such as lifestyle, language and education’ (2015:851).
Neubert (2014) argues that there are two groups of middle class, the established and those that are rising. Due to the precariousness of social mobility, for the group that are still rising, strategies need to be employed to succeed. Neubert et al use the Sinus concept of ‘milieus’ which ‘links socio-economic positioning, based on a descriptive model, with different socio-cultural orientations’ (2002: 4), ‘A milieu is defined in terms of a particular combination of so-called ‘building blocks’, that relate to social position, aims in life, work, image of society, family, leisure, ideals and lifestyle’ (Neubert et al, 2002:6). Neubert’s takes the theory of milieus a step further by suggesting that even though people can fit within the same economic level they can have different ideals from another (2014). He calls these ‘small lifeworld’s’, which he describes as ‘voluntarily chosen part-time lifeworld’s or communal spheres that share common interest and meanings’ (2002:7). Within these milieus people are also living within multiple ‘small lifeworld’s’. A member of a particular social class can therefore be a member of a ‘Milieu’ and multiple small life worlds even when they have conflicting ideals. Looking at the difference in behaviour and expectations of family and peer groups, and placing the focus on understanding at an individual level we can see that milieus are limited to a particular moment in someone’s life. They are subject to change dependent on consumption, leisure and morals, both past and present.
In this thesis, I will discuss how this the middle class group play varying roles; from parents to colleagues as well as family and friends. I will discuss how life for this group has changed and progressed in order for social aspirations to be achieved and to protect new social status positioning’s’.
Strategies for Success
Talking to and meeting with people and watching them in their daily lives I found that people developed different strategies which are employed to achieve success. From my fieldwork research, I found education and the side hustle to be two key strategies used to pursue upward social mobility.
Obbo and Spronk discuss the importance of education for social mobility (2014: 97). While Obbo did her study in Uganda in the 1986, Spronk focused on the yuppies in Nairobi in the early 2000s and found that the importance for education was still a key factor for social mobility. Education leads to economic potential which then allows the acquisition of property and the enjoyment of a lifestyle that is associated with a higher social status. In her article on
randomness of irregular income’ (2014:37). The desire for higher levels of education were typically addressed in cross-generational ways. In Spronk’s (2014) study of ‘yuppies’ in Nairobi, she found that the parents of the young professionals hoped that the investment in education would lead to a competitive advantage later on in life. In this context education is an important element to upward social mobility and shift in culture.
For this group, economic capital is important for achieving social progression. A key feature of the ‘yuppies’ studied by Spronk (2014) is their desire for financial freedom through having careers in the private sector or owning their own businesses. An important factor in understanding social mobility within Nairobi is the effect that structural changes that occurred in the late 20th and early 21st century. Spronk (2014) argues that the impact of moving from a state led to neo-liberal policy allowed for innovation and entrepreneurship within Kenya and especially for the ‘yuppies’. A result of this was the social distinction that was made between those that worked within government bodies such as civil servants and those who worked for private corporations. Working within the private sector was seen to have a higher social status level than working within the public sector.
In James book ‘Money from Nothing’ she discusses the impact social mobility can have on kin. Dependent on choices that are made, life trajectories can be very different resulting in situations where one or multiple kin members are dependent on another. In agreement with this, Neubert (2014) argues that lifestyle choices, such as choice of housing, profession and education, are a key factor in the social distinctions that exist within members of the same social class and can often be a significant factor of social stratification.
Within this middle class grouping, a key factor for change is not the accumulation of material wealth but to be continuously working toward improving their current situation (Neubert, 2014). As Leichty states ‘What constitutes this sense of middle-classness is not necessarily a common lifestyle or a uniform set of values but rather a shared project of locating oneself in a new and legitimate space’ (2003:67). Aspiring for higher levels of education, better housing, higher income and a higher standard of living are all part of the process of being middle class. So, within this thesis, middle classness will be studied as a process, as an aspirational category (Spronk 2014) which discloses the ambitions and strategies of people in pursuing the social ladder.
Strategies of Risk Mitigation
According to Bähre (2012), insurance policies as a form of risk mitigation can be a great benefit for both the insurance companies and the clients. However, within the context of
sub-Saharan Africa the adoption of formal insurance policies has been difficult to develop or maintain.
Discussing the roles of brokers in South Africa, Bähre notes the importance of kin and social relations in the selling of insurance policies and the indebtedness felt by brokers due to having to call on these relationships to do their jobs. Bähre notes that insurance companies use a certain method to partner with organisations such as churches to sell more policies (2012:157). Belonging to certain social groups, such as the church, allows for direct access for members to purchase insurance policies, as brokers will attend social events for these groups. However, Bähre argues that there is exposure and risk that comes with moving from local measures of risk mitigation to those of the wider market. By changing from using traditional methods of risk mitigation such as reliance on kin or local savings groups this leaves exposure for higher risk (2012:159).
With a change in economic and social status comes a change in thinking and increase in levels of choice. James (2015) suggests that because of expectations, social mobility might cause more costs than benefits for some. Change in social class comes with the expectation to consume in a way that increases expenditure. The social pressures to live a certain lifestyle and consume at a certain level may mean despite having a stable income, consumption is higher than what can be afforded. As Neubert (2014) highlights an issue with social mobility is that unless there is a secure income downward mobility is very possible. James (2015) argues that there is an awareness of bad spending habits of peers, who are living outside means to ‘keep up with the joneses’. A conscious choice, despite the pressure from peers, has been made to not do behave in the same way. In the biographies collected by James (2015) she notes that people will often sacrifice on certain commodities to move upwards socially. So, in this thesis I will focus on the different methods that are used to mitigate against risk, why they have been chosen and the benefit they are seen to provide.
Balancing social expectations
In her book, James (2015) discusses the competition that comes with moving upward into the middle. She argues that competition between peers can be a factor for going into debt
because of wanting to maintain a similar lifestyle to peers by purchasing and consuming in the same manner. James (2015) notes the contradiction that occurs between the desire to move upwards socially and the expectation to outwardly appear equal to counterparts. She
prevent jealousy (James, 2015). The question is how people balance social expectations and their desire to climb the social ladder which inherently needs to be noted to be real.
How people navigate social expectations and personal desires was the focus of my research. According to Vigh (2009) our environments are constantly in flux and our ability to find strategies to cope with this is also continuous. He continues by suggesting that activities that ‘become ‘everyday’ influence how people behave and communicate and affects the choices that they make’ (2009: 420). Lamont et al (2002) argue that to understand the expectations and tensions that this middle class group feels, you must look at the social distinctions (boundaries) they create while setting up life. The purpose of boundaries is the need to show a distinction between yourselves and the social groups above and below (Lamont et al,2002). Cohen describes boundaries as ‘essentially a matter of consciousness and of experience rather than of fact and law’ (1994:49).
Cohen (1994) argues that the uncertainty that comes with moving from one social status to another creates a need to develop a new identity. By claiming a new cultural identity ‘you do not merely associate yourself with a set of characteristics: you also dissociate
yourself from others’ (1994:51). Leichty adds to this argument by suggesting that ‘the middle class is constantly renegotiating cultural space – a space of idea, values, goods, practices and embodied behaviours – in which the terms of inclusion and exclusion are endlessly tested, negotiated and affirmed’ (2003:25). I define the middle class as those who have a disposable income that allows them the choice of investing in education, housing and commodities. They also distinguish themselves by a set of values and morals and aspire to move upwards socially.
As will become apparent in the following chapters middle classness is more than just income levels. In the context of Nairobi, middle classness is connected to the social status and aspirations that comes with being in this group. There is strong desire to improve life, have a good and comfortable life and remain healthy and distinguish oneself in doing better. This then informs the desire for pursuing social mobility to climb the social ladder.
Interestingly, while climbing the social ladder, social expectations arise. There is pressure to maintain a certain level of prestige and to reciprocate towards kin. Expectations for this middle class group come from both others and themselves, as there is continued pressure to be seen to be doing well.
Methodology and the Field
I conducted my research over a period of 12 weeks between January and March 2017.
During this time, I was based in Nairobi living in the Hurlingham area. I spent majority of the 12 week period travelling to different areas in the city to conduct interviews and
observations. As mentioned earlier my main form of transportation was the use of Uber taxis. Speaking with drivers during the time spent in Nairobi traffic provided me with a different view points and opinions of the city. Over the period of 12 weeks I conducted 16 recorded interviews and three informal interviews in addition to carrying out observations at four different shopping malls. When the opportunity arose, I carried out participant observations in social settings such as bars, restaurants and clubs. Prior to leaving for the field I was put in contact with a guide to help provide me with an insight to Nairobi once I had arrived. We met face to face a total of three times but were in contact throughout my fieldwork period, as she supported me in introducing me to potential interlocutors.
From the interviews I did, I split my interlocutors into three groups, Young professionals (group one), Established professionals A (group two) and Established professionals B (group three). The first group (young professionals) were those aged between 25 – 30, had obtained their first degree and where in the process of or currently undertaking further study, working professionals in white collar jobs (insurance, law, many were still living at home with their parents, but saving with the view to purchase their own home). Established professionals A (group two), mostly in their 30s and early 40s, settled with a partner and/or children. This group tended to work in salaried jobs but also had one or two ‘side hustles’ to generate additional income. This group also aspired to develop their own businesses and become self-employed. Established professionals B (group three), in their 30s and 40s, home owners with children. This group also worked in salaried jobs, usually in a management role within an organisation. Like group two had a side hustle to generate additional income but had ambitions to move up the ladder in their current profession. The stories that I will share in this thesis are a selection from the interviews I carried during my fieldwork. I will use these to give an insight into how life in Nairobi is lived for this group and how they are actively striving for upward social mobility and higher status. This thesis will focus on the stories from interlocutors within groups two and three, professionals and entrepreneurs with families.
My Role
I arrived in Nairobi on the 4th of January (2017), with my father, and had the aim of starting my research the following Monday; after having had a few days to settle in, see my family and friends and get my bearings again. I am Kenyan, I was born in Nairobi but at the age of seven moved to the UK with my immediate family. I am, however, regularly back in Nairobi (one or twice a year) for holidays and have always had a close connection with Kenya which is still a ‘home’ to me. Despite this, prior to leaving for Nairobi I was apprehensive about how well my research would go. I worried whether people (outside of my usual social circles) would actually speak with me and if so, would I be able to gain anything useful from them. I was worried about how would they respond to me as I have an obvious Kenyan name but a very British accent.
Carrying out my research, travelling around the city in Uber taxis, interviewing people and even having conversations in coffee shops I found people to be very open to speaking with me. Many were willing to reveal a lot about themselves, their careers and their families. Often within interviews I would be asked about my connection with Kenya, why I had chosen to come back ‘home’ to do my research and I felt that my respondents seemed happy at the fact that I had chosen to study them and to do it at ‘home’. At the same time because I was also different, I livedin the UK and study in Amsterdam, I am at a safe distance for them to be open about themselves without what they tell me being used to compete with them. This placed me in a unique position, which allowed others to open themselves up to me and discuss their lives and ambitions. After one interview, I shared with my interlocutor that I was pleasantly surprised by how my interviews and research had been progressing and that my worry of interviews being stiff and not very informative was not grounded;
Wanjiru said ‘people need an outlet sometimes, and you are providing that. Being able to speak with someone who is interested in you but with no connection or attachment… it is kind of like therapy’.
Thesis Outline
Within the first chapter I will discuss the importance of education in Nairobi and how it is used for both upward social mobility and for establishing status within society. In chapter two I will discuss the different methods that are being used to mitigate against risk. Showing
how, despite the growth of the formal insurance sector, traditional methods of risk mitigation are still in use. I will show how through the weighing of risks this group are able to pursue their aspirations whilst making sure to mitigate against the risk of economic loss. In chapter three I will discuss how social expectations and tensions create distinctions within social groups and kin relations. I will show how social distinctions enables their continued pursuit of upward social mobility.
Chapter One – Welcome to Nairobi
From landing at the main and largest airport JKIA (Jomo Kenyatta International Airport) you can see and feel the chaotic vibrancy of Nairobi. Flights arrive from across the world and connect the west and east to the rest of the region. The airport, like much of
Nairobi, is modernising with a mix of new shiny terminals and those which have not changed since they were built in 1972. To the right side of the airport is Nairobi National Park, the only national park within a city. Over the past year there has been public debate over whether to build the connecting line for the new standard gauge railway through the park. All over the city there is construction of both commercial and domestic properties. Former housing estates are being knocked down to build tower blocks with apartments to accommodate the growing population, ranging from basic to luxurious. The city has several large scale American style shopping malls, containing both local and international stores, cinemas, restaurants and coffee shops. There are constant road works. During my field work I was living off Ngong Road one of the main highways in the city. The road is going through an expansion
programme, to widen the highway into a dual carriage way. Each day various sections of the road would be blocked off to be worked on. Due to the heavy and slow machinery on the roads, traffic levels increased. Nairobi traffic is notorious, so much so that a twitter account has been set up to give live updates of which roads should be used and avoided. Roads are filled with varying forms of vehicles from mkokotenis, large carts which are manually pulled from the front, and multiple matatus, public buses, to tourism vehicles and on the fancier, side the latest Range Rovers and other 4x4s. Along the main highways you will find hawkers walking between the traffic selling all number of goods, from fruit and vegetables, to art work, house hold products and car accessories, newspapers and mobile phone top-up cards. The city has a large expatriate community, with the UN headquarters and large international NGOs regional headquarters located in Nairobi.
The social calendar in Nairobi is always full. Whilst I was on fieldwork I attended film screenings at the Nairobi film festival and there was the Nairobi Restaurant week which highlights the culinary prowess of the city. Throughout the year there are festivals attracting artists from across the continent and on any given weekend bars and clubs are filled with local DJs performing. Nairobi has a growing tech community, the city if often referenced as ‘Silicon Savanah’. Nairobi is home to iHub which supported the development of Ushahidi the crowd mapping technology and M-PESA, the mobile money platform developed by the
Kenyan telecoms company, Safaricom. Entrepreneurship is a core part of the city. In February 2017, a Kenyan version of the apprentice was launched; ‘Blaze Be Your Own Boss’.
Kenya is the hub for commercial activity across East Africa with Nairobi being home to the majority of the services and talents that are then deployed to neighbouring countries Uganda and Tanzania. Kenya has very strong trade links with its neighbouring countries and the EU. The country has over the past 10 years gone through several transformations and economic growth. The Kenyan government has set up a national development plan called ‘Vision 2030’ which has the aim to ‘transform Kenya into a newly industrializing, middle-income country providing a high quality of life to all its citizens by 2030 in a clean and secure environment’. The Vision is made up of three key areas: Economic; Social; and Political (Government of Kenya, 2016). In 2010, a new constitution was introduced that made great changes to the political and economic governance of Kenya. The economic and structural changes that have been made over the past 10 years have contributed to sustained economic development. The World Bank’s most recent economic update reported that Kenya was projected a 5.9% growth in 2016, rising to 6% in 2017. According to the World Bank, ‘Kenya has the potential to be one of Africa’s great success stories from its growing youthful population, a dynamic private sector, a new constitution, and its pivotal role in East Africa”. Kenya’s political context has had a history of great domestic tension and opposition due to heavy centralisation of power within the government and high levels of corruption. Although corruption is still high, the 2013 elections passed relatively peacefully. The next elections are to be held in August 2017 with the incumbent president Uhuru Kenyatta running to maintain his seat.
On the Human Development Index Kenya ranks highest in the region. Despite the great economic growth, Kenya remains a very unequal society. Levels of absolute poverty have declined however wealth has not been equally distributed. Kenya’s entrepreneurship and human capital give it huge potential for further growth, job creation and poverty
reduction. The recent discovery of oil and other mineral resources creates great potential for the Kenyan economy.
into middle-income status. On the individual level there is the aim of moving upwards professionally and socially. In this chapter I will discuss the current public debate Kenyans are having on the middle class in Nairobi. I will then discuss how tools such as education and the ‘side hustle’ are used to elevate status and allow for navigation within a continuously evolving society. I will show how the Nairobi middle class are achieving their aims of moving upwards socially in an environment that can be very competitive and where expectations to do well are strong.
The Public Debate
I spent some time online researching articles and discussions about the ‘middle class’ in Nairobi, I wanted to see what (if any) the dialogue on the topic was like. Whether people identified with the term ‘middle class’ or if this was something that had been applied by researchers and academics. In my first week in Nairobi, I spoke to various people who would ask what I was doing in Kenya and what my research was on. A frequent response I would hear would be, ‘but who is this middle class?’, ‘is there really a middle class?’, ‘if someone somewhere in Muranga has a small piece of land and lives on their own plot with no debt, are they also middle class?’ (Muranga is a county in the central province of Kenya). Or I would hear things such as ‘you know, banks are starting to open small branches in a town on the other ‘side of the city’ because those guys are very cash rich from their biashara’s,
businesses’. I was not able to confirm these sentiments. However, what it did show me was that there was a public discussion about how much this middle class in Nairobi really existed. People were questioning whether they were a part of the middle class or not. With the ‘what’ qualifies someone to be part of this group a clear interest point.
In early April, an article was published on the website of Capital FM (one of Nairobi’s leading radio stations), the title being; ‘Nairobi’s middle class is broke and fake, here is why!’(Odongo,2017). The author of the article argued that the middle class where living off loans and spending money that they did not have. His view was those who live on the ‘other side’ of town were very cash rich and willing to live without the frivolities that middle class spent their money on. What I found to be most interesting was the comments section. There was a clear divide on view points. Comments highlighted that the Nairobi middle class was not just income and expenditure but also standard of living, job type and social setting. As one commenter stated:
‘From an economic stand point, people need to spend money for the economy to grow. Those mechanics in Grogan depend on the middle class to get paid. They themselves as you
mentioned have no time or money to waste on luxuries like cars. Those electronics on Luthuli are procured by middle class fellas. Those loans they are servicing are keeping bankers at their jobs’.
What these sentiments showed me was that in Nairobi the middle class is viewed as more than just economic wealth, lifestyle choices are an important factor and a clear form of distinction. The choice on what to spend time and money on was a clear distinction between those viewed as middle class and those who lived and worked on the ‘other side’ of town.
During my fieldwork, a key point I found to be interesting was the difference between what people said in public and what they said in private. I would often hear people mention that they thought many middle class Kenyans were living off loans to maintain their lifestyle. There was an expectation to be living in a certain area, work in a ‘white collar’ job or be an entrepreneur, own your own car and have your children attend the more prestigious schools in Nairobi. However as much as there was an ideal lifestyle that was talked about the aspirations of this group stretched further than just the status that comes with driving a nice car, or attending the latest event. There were clear goals for personal and professional
development and utilising the resources available to achieve them. In Kenya, aspirations are a social good and something that should be continuously worked towards. In the case of the singer from Camp Mulla, going from being a star to an Uber driver was seen to some as step backwards, a failure almost. However, in Nairobi, to succeed and achieve the prestige and status that is desired strategies need to be employed to help this happen.
Strategies for Success
An interesting point to note when studying the middle class is their ability to make choices, the agency they seem to have over their future. De Bruijn et al (2007) state that despite political and economic circumstances, African societies have found a way to navigate these issues and develop. They argue that ‘One cannot simply define a duality between changes from the outside and an actor’s responses; on the contrary, the interlinkage and co-production between actors and these changes make for social transformations’ (2007:2). De Bruijn et als continue by adding that ‘the dichotomy between actor and structure has become
notes that agency is very much dependant on the environment and having to balance what you want to do with what you are able to do. Vigh (2009) states that environments are constantly in flux and therefore the strategies to cope with this is are also continuous. He argues that how everyday life is lived out is not a passive activity. Instead it is a process of understanding and analysing external factors so that you are then able to navigate.
(2009:421). Vigh describes this process as ‘muddling through’. By constantly moving, ‘ducking and diving’ one is then able to get a clearer view of their life in an environment that is constantly in flux (2009:424). He argues that to achieve your end goal there needs to be ‘Dynamism and Fluidity’ (2009).
Resnick (2015) suggests that when looking at the middle class it is useful to look at what this group see to be necessary investments. Resnick (2015) also notes that a key factor for social change is not an increase in material wealth but to be continuously improving the current situation. In agreement with this Barlosious (2014) argued that a key factor in upward social mobility was making a change to one’s life trajectory. Barlosious (2014) continued her argument by adding that (2014) each person has a view of what the trajectory of their life should be and an expectation that should they fulfil certain requirements expected by ‘society’ they will achieve it. Neubert (2014) also suggests that an ambition of the middle class is to be continuously maintaining or improving on their current situation.
To understand the importance of education for this group, it is important to note the social changes that occurred post-independence in 1962. During the colonial era, education was segregated along racial lines with schools built specifically for Europeans, Asians and Africans. Whilst after independence the school system was desegregated. Neubert (2014) suggests that structural changes, such as those that occurred in post-colonial Kenya, can be seen as a reason for the growth of the middle class. By moving away from the state driven policies to more neo-liberal policies innovation was able to happen.
As noted by Spronk education is seen to lead to economic potential which then allows for the acquisition of property and the enjoyment of a lifestyle that is associated with a higher social status (2014: 97). As stated earlier, Barlosius notes the observation by Bourdieu that formal schooling and training were essential in order to gain regular incomes (2014:37). Education serves as a strategy to acquire cultural capital which in turn allows for better opportunities to secure employment. Spronk (2014) noted that an important goal for her was to advance their children’s status (and social positioning) from an early age through the investment in education.
As pointed out by Spronk (2014), this middle class groups want for financial freedom through having careers in the private sector or owning a business is highly important. For this group feelings of modernity and having more of a national identity rather than a traditional tribal identity were key for their social development. Spronk also noted that another effect of the structural changes that occurred in Kenya in the late 20th and early 21st century was an increase in entrepreneurship. Within her studies, she found there to be a distinction made by ‘yuppies’, between those that worked for private corporations and those that worked in government bodies as civil servants (Spronk 2014). For this group, the accumulation of economic capital is important for achieving their social progression but often cultural and social capital are drawn on to advance (Bourdieu, 1986).
How people respond to social changes is how social transformation occurs. As I will show, in the case of Nairobi, education and job security along with the side hustle resources utilised to achieve this.
Education
Wanjiru was showing me her thesis which she had completed for her Master’s in Business and Entrepreneurship. We were sat on the dining room table in her flat, in front of us was the living area where her son was sleeping on the sofa and the TV was on a children’s
programme. We had been talking for a while about her being an entrepreneur and I had asked her why she had decided to pursue a masters in that particular course.
She said: ‘I needed to know how to run a business… some of these skills, like doing accounting, balancing your books, profit and loss, marketing and entrepreneurship. You know, starting a business from scratch for yourself. Learning to look for money without begging and also balancing family life. Being a single mum… it’s not easy’
Wanjiru is a single parent to her five year old son and an entrepreneur. She runs her own business producing condiments and baking supplies. A few years back Wanjiru had gone back to school to pursue a masters which she hoped would help in the development of her company. After going through her thesis and talking about how it applied to what she did now, I was interested to know whether she had now finished with education or if she had plans to pursue any further studies. She said, ‘I’m trying to go back… if I get accepted’. Wanjiru has applied to a course at the university of Stellenbosch (in South Africa) in Food
‘because I want to understand my products, I want to be able to check what my suppliers are bringing me…’. Her educational pursuits were not limited to herself, we had been talking a while about her plans for the next few years; where she saw her business and what she planned for her and her son. She said ‘He’s at a kindergarten, just up here called seedlings, it’s a Montessori’. Her son Kelvin, is soon to be starting primary school but the process of finding a suitable school near her home and work have been difficult;
Wanjiru continued speaking, saying: ‘Cavina (a private catholic school), that’s another one, we’re all on the waiting list, just biting our fingernails. It’s becoming crazy… we started looking like two years ago, but the competition is high because of the connection between British high schools and then getting into universities. I understand that British schools don’t like Montessori… and actually, I find him stagnating where he currently is’.
Before fieldwork I spoke quite frequently with my parents about their aspirations for themselves and their children and the strategies that were used by them to reach their goals. In my family, education was always a key tool in being able to achieve goals. For my siblings and I, we were told that our ‘compulsory’ education ended with completion of our first
degrees. After that we could chose if we wanted to pursue further studies. All my siblings and I have completed an undergraduate degree (two in law, one engineering and I studied
Biological Anthropology). Currently, I along with one of my sisters are pursuing our masters’ degrees. Despite Anthropology being quite different to the subjects that my siblings and wider family had studied my parents were supportive of my choice of studies and encouraged me to study well. My grandfather, who was a teacher and schools’ inspector, will always ask if I am still in education, what I have studied and encourage all of us to always continue learning.
My family are not unique in this sense, for Kenyans education is highly important and key in aiding in the pursuit of aspirations. Returning to education to pursue higher education was a common feature amongst those who I interviewed. Of the 16 people I interviewed 10 were either in the process of or had completed a post-graduate degree or professional diploma. Reasons for pursuing higher education were either for purposes of growing their own businesses or moving upwards in the organisations that they worked for.
In Nairobi, education is seen as a key to upward social mobility as it provides an opportunity for skill and knowledge development. Wanjiru had pursued a masters so that she would be able to gain the skills she needed to run her businesses effectively and
independently. As she stated, she wanted to know how to look for money to invest in her company without having to be reliant on others. What I found to be most interesting was her desire to be able to run her businesses effectively and independently.
As we spoke about her Masters and her desire to continue studying I could see the pride she had in what she had been able to accomplish. It was clear that she wanted to show that being a single parent and running her own business had not stopped her being able to
complete her studies. Completing her masters whilst also managing her business and being a single parent had I required a high level of effort and therefore needed to be acknowledged. Returning to school to pursue higher levels of education served to not only increase skills and knowledge but was also as a way of showing progress and was a clear indication to both Wanjiru and others that she was working towards achieving her goals.
Within the group I interviewed I found that education was seen as part of a continuous process of development and integral part of their strategies to succeed. Where an opportunity to develop new skills and knowledge was seen, it was taken. As Wanjiru and I continued to talk about her plans for developing her businesses and pursuing further studies I could sense that she was going through a process of reflexivity. Looking at where her business was now, what skills she still needed to acquire, what she hoped would happen over the next five years as well as what would be required to achieve this. Continuing to study, by starting the course in Stellenbosch, was part of the strategy to help Wanjiru pursue her goals.
Education was not only important for the individual but also for their children. In Nairobi, there is an aim by parents for their children to have better opportunities than they had, to be able to start a step ahead from where they began. This has meant investing in education from an early age, as there is a view that having a good education will allow for upward social mobility. As Wanjiru and I spoke about her son, Kelvin, where he was currently at school and what schools she would like him to attend, I could sense that attending a school with a good academic record was important. Wanjiru seemed keen on making sure that her son would be pushed academically, something that he did not seem to be getting in his current. There was disappointment at the fact that he was stagnating at his currently school and I could a desire
her son to school such as Cavina, a British system preparatory school, was in her view the starting point for him to be able to pursue his goals and move upwards socially. However, the high investment in educations means that there is an expectation from parents for their
children to perform well academically. There is an expectation that by doing so children will have a better chance of success later on in life. By having access to international universities and moving into high paying ‘white collar’ jobs they will be able to gain secure incomes.
The school a child attends were not only important for academic performance but also for the social status that the school. Wanjiru had placed her son on the waiting school for a private school when he was only two. This showed not only her goal for him to succeed but also to show her capability in being able to provide private education for her son. Parents will often send their children to elite schools in Nairobi, not only because of the standard of education but also for parents to show that they are doing financially well. Investing in what is high quality education, in Nairobi, was for parents a clear indication of success.
Private international Schools in Nairobi are what is most sought after by parents. There is an expectation for your child to attend the best British or International Baccalaureate schools. However, the cost of sending children to private school is very expensive. Cavina where Wanjirus son is on a waiting list is KSH714,000 (approx.US$6,889) per year. However, price ranges for the most sought after private senior schools in Nairobi range from KSH428,000 (US$4,129) KSH2.7million (US$26,000) per year. There is an expectation that if a child starts their education in private junior school then they should continue into a private senior school. This requires a high level of expenditure for parents.
The competition to place children in the top schools in Nairobi has meant that they have become some of the most expensive in Africa. The high costs of the schools have created an air of exclusivity about them. Being able to send children to these schools gives parents a higher social status. Therefore, there is social pressure and competition from peers to be able to do so, as being able to afford the very high school fees is a sign of strong financial
stability.
Side Hustle, ‘That's how we do it in Nairobi’
I had met Wainaina at the food court at the Village Market mall. We had met a few years ago through mutual friends and I had contacted him through Facebook in December to see if he'd be willing for me to interview him. On his profile he had pictures of his family and also promoted his marketing and branding company on there. Village market is one of the older ‘Malls’ in Nairobi, it opened over 20 years ago in the Gigiri area, a more upper class
neighbourhood. The US embassy and UN headquarters are in this area and it has a high level of expatriates living and working there.
We had arranged to meet at 11am, however Wainaina was running late due to car trouble. The mall was quite quiet with it being a working day and so after walking around looking at the shops for a while, I went and found a quiet corner in the food court with shade. Where Wainaina and could talk without too much distraction from what was happening around us. Once Wainaina arrived we greeted each other and spent some time catching up on each other’s lives and what we had been doing over the years. This led quite smoothly into me starting the interview. I started by asking about his background where he had grown up, gone to school and what he had studied. As we spoke about his university course he said that he had dropped out of university to focus on running his own business with his former roommate. I asked him why he had not completed his studies and he said ‘'… I dropped out of campus...because of business, I started making money'. I asked Wainaina what the business was, he said ‘we'd have a TV in our room and we would hire it out to bars near the campus. Then we started selling t-shirts and other branded items. That is how we got started… that's how MY business started by the way'. He has since parted ways with his business partner, which when I asked why, he said ‘difference of ideas and opinions and then I got a child and got married, so I decided I had to start making more money'.
Like with Wanjiru, I was interested to know what Wainaina's plans were for the next few years, where he saw himself and his business. He said, ‘five to ten years…hopefully my business will be much bigger than it is right now’. His wife is also an entrepreneur and has her own cake company, they’ve been planning for her to expand the business and start a baking school in Nairobi. I asked him if that was something that they were working on for 2017.
Wainaina: ‘Oh yes, in fact she’s working on that and we’re just looking for funds here and there, so that she opens her shop and now starts training people…. Last year we started talking to banks and there’s one that’s willing to partner with her, so now we are just waiting to see what the loan amount is…’
it’. Wainaina then began to talk about his experiences with Uber, he has been an Uber driver has been an Uber driver since March 2016. Wainaina was talking about working as an Uber driver and the difference in income from when he started to now. As he had mentioned, in Nairobi, once something is seen to be succeeding and a good income generator ‘everyone’ wants to be part of it. He said ‘January has been tough, because everyone is now buying a car to put in an Uber. So, the profit margins we were used to are less’. Despite this he still thinks he will stay with being an Uber driver for a while. Wainaina said:
‘I will… but hopefully if my wife is expanding her business then I will get another car. Then I can employ someone else to do the driving… there’s always the side hustle. Always. That’s how we do it in Nairobi. I was even saying to my wife if this works (her cake business), I’d definitely quit my job and help her because it could take off and we could start expanding into different counties’.
Competition in Nairobi to be successful is high. In order to maintain a lifestyle and status associated with being middle class there is a need to supplement incomes by having more than one job; a main role and a side hustle. The ‘side-hustle’, secondary income sources, is a normal part of life in Nairobi. As Wainaina mentioned ‘that’s how we do it in Nairobi’. Even those who I interviewed who were employed and not businesses owners or entrepreneurs all had some form of side income. This would come either from investment in a project, running a small business or even having a small farm, where produce was sold for profit. I found that the side hustle allows for additional income whilst being able to pursue other ambitions.
As I spoke to more people in Nairobi it became apparent that, like Wainaina, a key to success was to be continuously looking for opportunities for income generation. Being able to turn an opportunity into a viable business or income source was a way of showing success to others and allowed for the freedom to pursue other aspirations. I could sense that a key element of the side hustle was to create ones own opportunities in order to work for yourself and grow wealth independently.
In Nairobi, there seemed to be a mentality to pursue opportunities wherever they come up. Wainaina became an entrepreneur when he was at university with his small business. Which he has grown into the company that he has now. It was interesting to note that, despite education being an important part of social development in Kenya, he had dropped out to pursue a business opportunity when it came up. Being able to earn his own money and
support his family independently was important for Wainaina, more so than gaining a qualification.
In addition to this, the copycat mentality means having to continuously keep looking for new opportunities. When something is seen to be going well others will be keen to do the same. Therefore, to allow for continuous growth there is a need to be a constant reviewing of what has been achieved and what can be done next. As was shown with Waininas experience of Uber, because of an increased number of Uber drivers in Nairobi his profit margins had gone down in comparison to the previous year. However, whilst looking at ways he could increase his business with Uber he was also looking at how his wife’s company could
develop and expand to other counties. His opportunities were not limited to what he presently had. Instead by looking at what else could be achieved he was able to see where he could develop what he currently has. As I spoke with Wainaina it became clear that his use of the ‘side hustle’ was to achieve his aspirations for himself and his family. Investing in second car for Uber and looking for a loan to expand his wife’s cake business were all strategies, that in his view, would allow him to move upwards.
In an environment that is continuously changing, there is a need to be constantly adapting to what is happening and creating a positive outcome from each situation. As seen with Uber, despite the lower returns due to a higher number of people being Uber drivers both Joel and Wainaina were developing new strategies to be able to continue growing their own business with Uber. As I interviewed and spoke with more people in Nairobi, I could sense that an important issue for this group was to find their own space within society and to create their own opportunities. The additional income that comes from the side hustle allows for navigation and stability whilst pursuing goals.
Conclusion
Wanjiru: ‘in Nairobi if your son comes home and says he wants to be a police man you would be worried. That is why you must stay in school and work hard so you and they don’t have to do some of these jobs’.
Within this chapter, I have shown that in Nairobi to achieve ones aspirations and climb the social ladder education and the side hustle are methods used to achieve this. Being able to navigate the different obstacles and challenges that come with living in Nairobi there
is a need to be continuously reflecting on current positioning socially and professionally and looking at how to navigate the next steps.
In Nairobi, there is an expectation for both individuals and their families to be
successful and a pressure to be able to show this to peers. What career one has, along with the education level they can provide for themselves and their children is seen as a way of
showing status and success. Having a high level of education, working in a ‘white collar’ profession or being an entrepreneur are all seen as methods to help climb the social ladder.
As shown in Wanjirus story, education allowed for the development of her own business and in planning for her son’s education early she would ensure that in the future he had the capability to pursue his own aspirations and goals. For Wainaina the ‘side hustle’ enabled him to maintain a steady income in an environment where competition is high, whilst also being able to develop new ideas and opportunities to develop both his and his wife’s businesses. In both cases striving for one’s goals and aspiring to move upwards, both for themselves and their children was a strong feeling and key focus for their lives.
Education and the side hustle both served as methods to acquire both cultural and economic capital. As shown in this chapter the agency one has is very much dependent on the environment and to succeed there must be a conscious effort to plan how what resources are available can be used to achieve this.
In Nairobi change is occurring at all levels, therefore to be able to pursue goals and aspirations these changes and obstacles must be navigated by utilising available resources to create strategies for success.
Chapter two - Balancing the Risk
I was sat with Kim at the Java coffee house. We were discussing being the middle children in our families and how as we had gotten older our relationships with our siblings had changed. I had said that I now felt closer to my siblings and had better relationships with them now that we were all adults. Kim, however, had the opposite feeling. Due to changes in lifestyle and different economic levels her relationship with her older brother and younger sister had become strained and distant.
She said ‘…it causes animosity in families. I can tell you, for example, I don’t really talk to my brother because of the choices he’s made. He lives in Jamhuri (a less affluent area of Nairobi). When you are growing up you just automatically think that your older siblings, should be the ones to set the standard. That’s how it should be. My younger sister, I feel she thinks she has to compete with my lifestyle. But my lifestyle is completely different from hers and the only reason I live my lifestyle is because of my partner. Let’s be honest, if I were to take him out of the equation I’d be back in the UK living a single mums’ lifestyle. Working 8am-5pm picking up Jeremiah from nursery at 5, going home and cooking dinner. There would be no way I would live in Nairobi as a single mother. There is no way, I couldn’t afford it’
Within Nairobi, the choices that people make and the risk that comes with pursuing upward social mobility can be very high and come with the very real possibility of loss. As shown with Kim, even within families, the choices made can lead to very different life trajectories. A result of this can lead to animosity between kin and a break in relations. Adopting methods of risk mitigation is important to protect the standard of living that has already been achieved. Risk mitigation also allows for the pursuit of aspirations and moving up the social ladder whilst preventing damage to social relations.
Within this chapter I will discuss the methods this group of middle class Kenyans are using to mitigate risk. How they go about finding the best solutions and the impact this has on their ability to move upwards socially and achieve their aspirations. Using three stories, I will show how trust and social relations play an important part in protecting ones-self from loss. However, as will come to light, who and what to trust can vary greatly even within the same the family.
In my initial proposal for fieldwork I was very interested in the role formal insurance played in mitigating risk in Nairobi. As part of the proposal I researched the current insurance market in Nairobi and found that it was a focal point of interest for international companies looking to invest. A report by Ernest and Young, stated that the combination of an expanding middle class and a young population along with regulatory reform in the insurance sector was set to increase the number of insurance policies purchased in Kenya (Ernest and Young, 2016). In 2014 Kenya generated insurance premiums of US$1.8billion (the second largest, following South Africa) and is forecasted to grow at a rate of 6% by 2018, which would mean market growth to US$2.2 billion by 2018. An increase in life expectancy means that there should be an increase in demand for personal insurance coverage. There were also predictions that younger Kenyans are becoming more aware of the benefits of insurance due to a shift in cultural awareness and being more risk-oriented. However, despite the potential and growth of the Kenyan market and economy uptake of formal insurance policies is still quite low at 1.2% of GDP. Only 2.3% of the Kenyan population has a formal insurance policy (Ernest and Young, 2016). Despite the amount of revenue generated from insurance in this market, it is still only from a small population of the country.
When I spoke with my guide, Doris, I asked her about the insurance market in Kenya and what her opinion was on insurance companies in Nairobi. She mentioned that there was distrust and misunderstanding of insurance companies. She said that there was a feeling of not knowing who to trust and whether they would actually pay out if and when something where to go wrong.
Strategies for Risk Mitigation
To understand the need for risk mitigation there is a need to understand why it is important for the middle class. Neubert (2014) argues that a key issue with social mobility is that unless there is a secure income, downward mobility is a very real possibility. James (2015) argues that a change in social class comes with the expectations to consume in a different way. An increase in expenditure is done to achieve social change. However, James (2015) goes on to say that expenditure is not always frivolous but includes investments that are now seen as being mandatory to this group. Rather than focusing on short term
commodities and focus is places on long term investments.
In addition to this James (2015), discusses the competition that comes with moving upward in to the middle class. She argues that competition from peers can be factor for going into debt because of wanting to appear at the same level by purchasing and consuming in the
