Influence of Microfinances’ (MFIs) Socio-Economic Services on the Number of Employees in Welding Enterprises, Kitui County, Kenya

Abstract

This study assessed the influence of microfinance socio-economic services—business expansion, job creation, income growth, and poverty reduction—on the number of employees in welding enterprises in Kitui County, Kenya. A quantitative correlational design was adopted to objectively test the relationship between microfinance socio-economic services and enterprise employment without manipulating study variables. From a target population of 848 registered welding enterprises across Kitui Town, Zombe Town, Kabati Town, Kwa Vonza, Mutomo Town, and Mwingi Town, a sample of 272 was drawn using Yamane's (1967) formula, with data obtained from 259 respondents through stratified random sampling, which ensured proportional representation across all geographical strata. Data were collected using a structured, closed-ended questionnaire on a 4-point Likert scale and analysed via descriptive statistics and multiple linear regression in IBM SPSS Version 27. Results showed that business expansion (β = 0.588; p < 0.001) was the strongest predictor of employee numbers, followed by job creation (β = 0.423; p < 0.001), income growth (β = 0.393; p = 0.024), and poverty reduction (β = 0.368; p < 0.001), all significantly positive. The study concludes that microfinance socio-economic services promote employment growth in welding enterprises and recommends that microfinance institutions prioritise business expansion financing while strengthening job creation, income-enhancement, and poverty reduction interventions to sustain inclusive SME employment growth in Kitui County.