With the nature of formal employment changing and uncertainties brought about by the Covid-19 pandemic, many employers have fired their employees. Businesses are failing and revenues are growing thin. Although job opportunities are likely to go up in 2021 compared to 2020, there is still a lot of uncertainty in the job market. As such, you need to consider an extra source of income besides employment. This is why you need to consider an extra source of income.
Challenges Posed by Covid-19
It is still not sure for how long Covid-19 is going to be with us. Many countries that had reopened their economies are going back to lock downs, while others are shutting schools. As such, people need to adjust and look for alternative sources of income. With the Covid-19 variant being reported in some countries, many businesses have not fully opened and most employees are on pay cuts.
End of Forbearance on Bank Loans
The government had requested banks to renegotiate loan repayment terms with their customers due to Covid-19 restrictions. The forbearance of these loans was coming to an end in December last year. Kenyans and especially those with bank loans need to look for alternative sources of income. This will help them repay loans and avoid extra charges.
End of Tax Relief
With the end of tax relief by the government due to Covid-19 restrictions in 2020, Kenyans will have to dig deeper into their pockets in 2021. Those that had been exempted from income taxes will start paying taxes from the end of January. This means reduced earnings while product prices have increased due to reintroduction of value-added tax. As such, people in this category will need to seek an extra job to survive in 2021. Otherwise, they may need to consider getting rid of some expenses to meet basic needs.
High Cost of Living
The cost of living has significantly increased compared to other years. This is because almost all products' prices have increased due to end of tax reliefs. For instance, bus fares are almost double, while most people are working on half salaries. It is still uncertain if the economy will improve and business resume to normalcy.
Expected Inflation due to 2022 Campaigns
If statistics is anything to go by, Kenyans should expect high inflation in 2021. Every year before the election date, there is usually high inflation. It is because there is usually less money in circulation as politicians prepare to start campaigning. With the challenges posed by Covid-19 and the expected increase in inflation, Kenyans need to look for other income sources to survive in 2021.
Read also: Five ways to cut down your expenses in 2021.
Resumption of Schools
Many parents will start paying school fees in 2021 after the resumption of schooling. This is after schools were closed in March 2020 due to risks posed by Covid-19. With the high number of Kenyans who lost jobs and others working on half salaries, many parents cannot afford to pay school fees out their income. Parents should start looking for other sources of income before they can deplete their reserves. It can be a part-time job or start a business that can start generating income immediately. It will help patents pay school fees and meet other basic needs.
Uncertainties in the Job Market
With the Covid-19 variant reported in several countries, it is still uncertain how 2021 will be. Many people expect that there will be a resumption of business and jobs. However, we still aren't sure what will happen as scientists continue developing Covid-19 vaccine. To be on the safe side in the worst-case scenario, Kenyans should start looking for alternative sources of income.