7.1 Types of job opportunities

A job opportunity is any chance to earn an income by using one's skills, knowledge and effort, either by working for oneself or by working for an employer. TVET graduates can create their own jobs through self-employment, earn by offering services to customers, make and sell products, or take up salaried employment in public and private organisations. Understanding these options helps a graduate choose a path that matches their skills, resources, interests and risk appetite, and many people combine more than one, such as a salaried technician who also runs a weekend repair business. Example: three graduates from the same electrical installation class choose different paths: one is employed by a power utility contractor, one runs a wiring and repair business, and one assembles and sells solar lamp kits.

7.1.1 Self-employment

Self-employment is working for oneself by running a business or trade, rather than working for an employer for a salary. The self-employed person decides what to do, when and at what price, bears the risks and keeps the profits. It is an important route for TVET graduates because it creates jobs where formal employment is limited. Example: a graduate in hairdressing and beauty therapy rents a small space in a market centre, buys equipment with a youth fund loan and employs two assistants within a year.

Forms of self-employment

• Sole proprietorship: A business owned and run by one person, such as a welding workshop.
• Partnership: A business owned by two or more partners who share capital, work and profit.
• Freelancing: Selling skills to different clients on a job-by-job basis, often online.
• Cooperative society: Members with a common interest pool resources, such as a group of fish farmers marketing together.
• Limited company: A registered company owned by shareholders, which separates the owners' personal property from the business debts.
• Franchise: Running a business under an established brand in return for fees, following its system.

Advantages and disadvantages of self-employment

Procedure for starting a small business

1. Identify a business idea: Choose an idea based on one's skills and a real need in the community.
2. Carry out market research: Study customers, competitors, prices and demand.
3. Prepare a business plan: Set out the products or services, target market, costs, pricing and expected income.
4. Raise capital: Use savings, family support, SACCO loans, bank loans or government youth funds.
5. Register the business: Register the business name through the eCitizen Business Registration Service and obtain a KRA PIN.
6. Obtain licences: Get the county single business permit and any sector licences, such as public health certificates.
7. Set up premises and equipment: Acquire a suitable location, tools and stock.
8. Launch and market: Open the business and promote it to customers.
9. Keep records: Record sales, purchases and expenses to track profit and pay taxes.

Sources of start-up capital

• Personal savings: The owner's own money, which involves no interest.
• Family and friends: Loans or gifts from people close to the owner.
• SACCOs and chamas: Loans from savings groups based on members' contributions.
• Banks and microfinance institutions: Business loans repaid with interest.
• Government funds: Youth and women enterprise funds and other government credit schemes.
• Grants and competitions: Non-repayable funds from development partners and business competitions.

Worked example: monthly profit of a small business

A graduate's mobile phone repair business earns Ksh 85,000 in a month. Spare parts cost Ksh 30,000, rent Ksh 8,000, electricity Ksh 2,500 and an assistant's wages Ksh 12,000.

Total expenses = 30,000 + 8,000 + 2,500 + 12,000 = Ksh 52,500

Profit = income − expenses

Profit = 85,000 − 52,500

Answer: Ksh 32,500

7.1.2 Service provision

Service provision is earning income by performing tasks or activities for customers, rather than selling physical goods. Services are bought for the benefit they give, such as a repaired machine, a well-cut hairstyle, a cleaned office or an installed water system. Many TVET skills lead directly to service businesses or service jobs. Example: a plumbing graduate provides installation and repair services to homes and schools, charging for labour and adding the cost of materials.

Types of services

• Technical and repair services: Electrical installation, plumbing, motor vehicle repair and electronics repair.
• Construction services: Masonry, carpentry, painting and tiling.
• Personal services: Hairdressing, beauty therapy and tailoring.
• Hospitality services: Catering, accommodation and event management.
• ICT services: Computer repair, web design, networking and data entry.
• Professional services: Accounting, surveying, consulting and secretarial services.
• Transport and logistics: Delivery, courier and passenger transport.
• Cleaning and maintenance services: Office cleaning, landscaping and pest control.

Characteristics of services

Providing quality services

• Competence: Do the work correctly using proper skills and tools.
• Reliability: Keep appointments and deliver on promises.
• Responsiveness: Respond promptly to enquiries and complaints.
• Courtesy: Treat customers politely and respectfully.
• Safety: Follow safety rules to protect customers, property and workers.
• Fair pricing: Explain charges clearly before starting work.

Worked example: pricing a service job

An electrician charges Ksh 800 per hour for labour and adds materials at cost plus 10%. A wiring job takes 6 hours and uses materials costing Ksh 9,000.

Labour = 6 × 800 = Ksh 4,800

Materials charge = 9,000 + (10% × 9,000) = 9,000 + 900 = Ksh 9,900

Total charge = 4,800 + 9,900

Answer: Ksh 14,700

7.1.3 product development

Product development is creating new products or improving existing ones to meet customer needs and selling them for profit. It allows TVET graduates to turn technical skills into goods such as furniture, garments, processed foods, metal fabrications and electronic devices. Successful product development starts with a real customer problem and moves through design, testing and costing before full production. Example: a food processing graduate develops a fortified porridge flour, tests recipes with mothers at a local clinic, gets the product certified and sells it through shops.

Types of products

• Manufactured goods: Furniture, metal gates, garments and footwear.
• Processed foods: Flour, juices, yoghurt and packaged snacks.
• Craft and decorative items: Baskets, beadwork, pottery and artwork.
• Agricultural products: Seedlings, animal feeds and value-added farm produce.
• Technical and electronic products: Solar kits, incubators and simple devices.
• Digital products: Software, apps, templates and online courses.

Stages of product development

1. Idea generation: Collect ideas from customer needs, problems and market gaps.
2. Idea screening: Select ideas that are practical, profitable and within one's skills.
3. Concept development: Describe the product, its features, users and price.
4. Design and prototyping: Produce drawings and a sample product.
5. Testing: Let potential customers try the prototype and give feedback.
6. Costing and pricing: Calculate production cost and set a profitable price.
7. Standards and protection: Meet quality standards and protect designs or brand names where needed.
8. Commercialisation: Produce in quantity, package, market and sell the product.

Worked example: setting a product price

A carpenter makes a study table using timber worth Ksh 3,200, other materials worth Ksh 800 and labour worth Ksh 1,500. He adds a 30% mark-up on cost.

Total cost = 3,200 + 800 + 1,500 = Ksh 5,500

Mark-up = 30% × 5,500 = Ksh 1,650

Selling price = 5,500 + 1,650

Answer: Ksh 7,150

Supporting institutions for product developers

• Kenya Bureau of Standards (KEBS): Sets product standards and certifies products that meet them.
• Kenya Industrial Property Institute (KIPI): Registers trademarks, industrial designs and patents.
• Kenya Industrial Research and Development Institute (KIRDI): Supports research and technology for product development.
• Business incubation centres: Provide workspace, mentoring and support to new product businesses.
• County trade and enterprise offices: Offer information on markets, trade fairs and support programmes.

7.1.4 salaried employment

Salaried employment is working for an employer, such as a company, government body or non-governmental organisation, in return for a regular wage or salary paid weekly or monthly. The employee works under a contract that sets out duties, pay, working hours and benefits, while the employer provides the workplace, tools and supervision. It offers a steady income and benefits, and is often a way for graduates to gain experience before starting their own businesses. Example: a building technology graduate is employed by a county government as a works officer, supervising construction of health centres.

Types of salaried employment

• Permanent and pensionable employment: Long-term employment with job security and retirement benefits.
• Contract employment: Employment for a fixed period, which may be renewed.
• Casual employment: Short-term work paid daily or for short periods.
• Part-time employment: Work for fewer hours than a full-time job.
• Internships and industrial attachment: Temporary placements for gaining practical experience.
• Apprenticeship: Learning a trade on the job under a skilled worker.

Employment sectors

Benefits of salaried employment

• Regular income: A predictable salary helps with planning and borrowing.
• Statutory benefits: Contributions to social security, health insurance and other schemes.
• Paid leave: Annual, sick, maternity and paternity leave as provided by law and contract.
• Training and promotion: Opportunities for skills development and career growth.
• Legal protection: The Employment Act protects workers against unfair treatment and dismissal.

Worked example: gross monthly pay

A technician earns a basic salary of Ksh 35,000 per month, a house allowance of Ksh 7,000 and a commuter allowance of Ksh 3,000.

Gross pay = basic salary + allowances

Gross pay = 35,000 + 7,000 + 3,000

Answer: Ksh 45,000 before statutory deductions

7.1.5 Comparison of self-employment and salaried employment