Navigating Income Security amid Rising Living Costs: Challenges Facing Middle-Income Earners from the Perspective of Senior Management Students at the Kenya School of Management, Kabete Campus, Kenya

Abstract

Essential components of financial stability are income security and the cost of living especially to middle income earners. These factors include inflationary costs of living, erosion of nominal wages, and inadequate social protection. This study explores income security and the cost of living especially as it affects the middle-income earners. In this study, Maslow’s Hierarchy of Needs was used to place economic insecurity outside the typical channels to classify the subject according to need hierarchy by demonstrating financial limitations compelling the individual to meet fundamental needs. A descriptive cross-sectional design was adopted. The study population consisted of 65 senior management students at Kenya School of Management, Kabete Campus. During data collection, only 60 completed the online questionnaires. Quantitative data collected were analysed using Microsoft Excel to generate charts. The data was analysed descriptively and presented in pie charts. The study findings show that income inabilities are highly prominent, in which 83.3% of the participants are unable to cover living expenses using paid work alone. Whereas 70% said they were able to save 10% of their income, the remaining 30% responded that they have no savings at all and thus emerged as economically insecure. Furthermore, 68.3% of beneficiaries depended on other sources of income to meet the demands, which also showed that formal income was inadequate. Therefore, the study concludes that middle-income earners today are experiencing higher tendencies of economic risk, with barely any capability to handle the changes. The study recommends targeted adjustments of the salaries to the inflation rate, encouragement of savings through appropriate taxation instruments, development of income diversification and micro-finance, and increase of subsidies on health care and social protection. They are intended to reduce the level of monetary stress, improve employment security, and increase the financial stability of Kenya's middle class.