Rising food and fuel prices have sparked protests across the region, most recently in neighboring Uganda last week.
Kenyan trade unions have threatened to hold a general strike this week if they do not get a 60 percent rise in the minimum wage.
“We are increasing the minimum wage by 12.5 percent,” Labour Minister John Munyes told a crowd gathered at a park in the capital to mark Labour Day.
He said the government had already taken several steps to help people struggling with price rises, including the removal of taxes on kerosene, wheat and maize.
Kenya sets a number of minimum wages, based on workers’ location, age and skill.
The lowest paid worker in the farm sector earned 4,076 shillings ($48.90) in 2009, while the lowest paid workers in urban areas earned 7,607 shillings, according to government statistics.
Speaking at the same Labour Day event before the raise was announced, the head of Kenya’s union umbrella group repeated his strike threat.
“If the raise is not suitable, we will issue a strike notice to the government. The economy of this nation is built by workers,” said Francis Atwoli, Secretary General of the Central Organization of Trade Unions (COTU).
“The cost of living has really gone up. It has become really difficult,” he added. Atwoli was not immediately available to comment after the minister’s speech.
Paul Muite, a senior lawyer and a former member of parliament, said the 12.5 increase in the minimum wage was inadequate.
“That is a drop in the ocean... clearly this is too little too late,” Muite told a local TV station after the raise was announced, warning that a wide gap between the rich and the poor in the country could provoke protests.
