Shaping Kenya’s Future: How KYEOP Transformed Youth Employment and Enterprise

Kenya, where nearly 80 percent of the population is under the age of 35, faces a growing employment crisis that demands urgent action. The vast majority of the country’s youth work in the informal sector, often in low-quality jobs that offer limited security, poor pay, and little room for advancement. These constraints are especially acute for young women and for those living in arid, semi-arid, and refugee-hosting areas, where infrastructure gaps, climate challenges, and economic marginalization converge. Recognizing this, the Government of Kenya, with support from the World Bank and research contributions from institutions such as the International Centre for Evaluation and Development (ICED) and Innovations for Poverty Action (IPA), launched the Kenya Youth Employment and Opportunities Project (KYEOP). Backed by $150 million in IDA funding, KYEOP set out to break down the barriers to youth employment by delivering an integrated program that combined life skills, technical training, entrepreneurship support, and labor market intermediation.

Skills and Hands-On Experience at the Core

At the heart of KYEOP was a multi-layered approach to building the employability of young Kenyans. Participants were equipped with foundational life and business skills before progressing to specialized vocational training and real-world work experiences. Internships with formal-sector companies and apprenticeships under master craftsmen in the informal economy gave young people a chance to learn by doing. These hands-on experiences were critical in helping participants gain industry-relevant skills and transition into long-term employment. For many youth who had never held a formal job or worked under structured supervision, these placements represented a first and vital step toward labor market inclusion. The program’s design emphasized both practical competence and professional confidence, nurturing a new generation of workers better prepared for the realities of Kenya’s evolving economy.

Entrepreneurship as a Path to Self-Reliance

In a labor market where formal jobs are scarce, self-employment and entrepreneurship offer critical alternatives. KYEOP recognized this and developed a strong entrepreneurship support track for participants with business aspirations. These youth were given access to business training, coaching, and financial resources in the form of small grants. The project also hosted a business plan competition that encouraged innovation and spotlighted scalable ideas with high-growth potential. The outcomes of this approach were striking: beneficiaries of the entrepreneurship track showed 65 percent higher business start-up rates, 85 percent survival rates, and up to 90 percent higher profits than their counterparts in the control group. These results not only demonstrate the effectiveness of KYEOP’s entrepreneurial components but also highlight the potential of Kenyan youth to become job creators in their own right when given the right support.

Performance Incentives and Better Job Matching

One of KYEOP’s most notable innovations was its results-based financing model. Instead of simply funding training providers and employers upfront, the project linked payments to the achievement of specific outcomes, such as successful job placements and training completion. This incentivized trainers and master craftsmen to deliver higher-quality instruction and ensure participants were truly job-ready. Additionally, KYEOP introduced a centralized digital platform to improve job matching between youth and employers. This platform reduced friction in the labor market by helping young people find opportunities that matched their skills and interests, while enabling employers to connect with a ready pipeline of qualified candidates. The platform was further supported by the strengthening of the Labor Market Information System, enabling more informed policymaking in the youth employment space.

Empowering Women and Changing Norms

KYEOP’s inclusive design paid special attention to the unique challenges faced by young women in Kenya’s labor market. From limited mobility and access to finance to societal norms that discourage women from entering male-dominated trades, these barriers have long restricted women’s economic participation. KYEOP tackled these head-on by offering childcare solutions, encouraging women to pursue non-traditional careers, and providing tailored mentorship. One standout example is Esther, a young woman who broke barriers by choosing a welding course under KYEOP. Initially met with skepticism by her community, she is now not only running her own successful welding business but also employing other young welders. Her story is emblematic of the broader shift KYEOP sought to spark—one where youth, regardless of gender, can aspire to and achieve professional success.

A Foundation for the Future: Scaling Up with NYOTA

Building on KYEOP’s success, the World Bank and the Government of Kenya are launching the $229 million National Youth Opportunities Towards Advancement (NYOTA) project. NYOTA aims to reach 800,000 young people and introduce new features, such as social insurance schemes for informal workers and expanded support for vulnerable groups like refugees and women. The project will also deepen connections between youth and business ecosystems, supporting a broader transition to a more dynamic, inclusive labor market. By anchoring these efforts in the lessons learned from KYEOP, NYOTA is poised to deliver even greater impact and ensure that Kenya’s youth are not only equipped for today’s jobs but prepared to thrive in tomorrow’s economy.

Ultimately, the story of KYEOP is a powerful testament to what can be achieved when governments, development partners, and local communities work together to invest in their most valuable resource: their young people. With smart design, evidence-based strategy, and inclusive execution, Kenya is proving that its youth are not a burden to be managed but a dividend to be unlocked.