Hire in Rwanda

Hire In Rwanda

Rwanda is a small, landlocked, hilly, and fertile country in Africa, with about 12.5 million people. Its neighbours include countries such as Tanzania, Uganda, and Burundi. The International Monetary Fund and the World Bank have contributed to economic and structural growth in Rwanda. Because of political instability that prevailed during the 90s, Rwanda was pushed back in the developmental process. However, because of foreign investment, national strategy implementation and an overall aim to achieve sustainable development goals, Rwanda targets to achieve middle-income country status by 2035 and High-Income Country Status by 2050.

Overview of Rwanda

According to the World Bank, Rwanda has 12.3 million people and a current Gross Domestic Product (GDP) of US $9.5 billion. Growth averaged 7.2%; per capita, and the gross domestic product (GDP) grew at 5%. While the measures taken to contain the COVID-19 outbreak were crucial to controlling economic activities, the economic growth rate has been high in Rwanda since the 1990s, averaging over seven per cent per year. Because of strong growth in the construction, manufacturing, services and agriculture sectors, Rwanda's economy grew nearly nine percent.

Total Population –14,414,910

GDP (nominal) – US $10.2 billion

Economic Overview

In the months leading up to the COVID-19 (coronavirus) pandemic, the economy of Rwanda was booming. It is clear by the recorded growth rate of over 10%. There have been serious spillover effects to the global economy due to the pandemic disrupting international trade. A disruption in international trade and travel harms exports and tourism in Rwanda just like any other country. A 0.4% contraction was experienced because of the pandemic. On the brighter side, there has been a promising projection of recovery in the Rwandan economy owing to low inflation rates, low corruption rates, and an overall decrease in the external debt ratio. The percentage dependence on foreign assistance dropped from 80% to 39%, as reported in the National Budget. Rwanda ranked 38 out of 190 economies to ease doing business in sub-Saharan Africa. The National Institute of Statistics of Rwanda (NISR) estimates that Rwanda's GDP per capita was US $818.

Market Overview

According to the National Bank of Rwanda, Rwandan exports increased by 3.8 per cent in value and increased by 40.6 per cent in volume, reaching US $1,164.5 million. Non-traditional exports and recurring exports contributed to the growth in value. According to the National Institute of Statistics Rwanda (NISR), Rwanda's export revenue was generated mostly by commodities, such as gold, tin, tantalum, tungsten, tea, and coffee. Rwanda's ranking in ease of doing business is 29th out of 190 economies. The government desires to turn Rwanda into a future market hub for business leaders and corporations. Rwanda's National Institute of Statistics (NISR) reports that the GDP per capita was US $818.

A brief glimpse of the industries in Rwanda

Several sectors dominate the economy, including agriculture, trade, and hospitality. A large part of Rwanda's economy is based on agriculture. Smallholder farmers produce 75% of Rwanda's agricultural output. Among the major crops grown in Rwanda are coffee, pyrethrum, tea, flowers, beans, cassava banana, Irish potatoes, rice, wheat, and sugarcane. The soils of Rwanda are fertile to the extent that they can support agricultural production in 61% of the country. Agriculture supported 23.54% of the GDP.

Major industries include cement, agricultural products, small-scale beverages, soap, furniture, shoes, plastic goods, textiles, and cigarettes. Rwanda has a small industrial sector employing 3% of the population and contributing 16% to the GDP. Production activities largely revolve around agro-processing and construction.

Services have contributed significantly to the growth of the economy in recent years. The forerunners of the economic expansion in the service sector are construction and tourism. A sizable portion of GDP, i.e., almost 47%, is contributed by the service sector. Due to the influx of foreign investments and aid from various international organizations, the service sector has emerged as a strong influence in Rwanda's progress. Rwanda is a member of the East African Community and the member of the Common Market for Eastern and Southern Africa (COMESA).

Cost of Living

The cost of living in Rwanda is, on average, 52.61% lower than in the United States. Rent in Rwanda is, on average, 63.14% lower than in the United States. Compared to other cities, Kigali scored 6215 out of 9294 cities in terms of costs. As the capital city, it ranked 1st in the country of Rwanda overall expenses. Overall, it ranks in the top 33% of the least expensive cities around the globe. Kigali is the largest city in Rwanda, with a population of 745,000. The cost of living for a family of four amounts to RWF 1,740,806.9 (US $1733), and for a single person, the cost amounts to RWF 709,226 (US $704). Refer to the table to break down the costs below: -

Cost of Renting

The renting cost depends upon the choice of the customer and preference of lifestyle. Area and size variations contribute to an increase or decrease in the overall rent of the apartment. On average, housing in an expensive area such as city centres can cost around 818,264 Franc (US $816.34), while in inexpensive areas, the average rent can sum up to 462,251 Franc (US $461.16).

City wise Cost of Living

Rwanda is bestowed with the East-Saharan landscape. With investment and development going hand in hand, many cities have developed that provide suitable working and living conditions with optimum lifestyles. Some popular cities are: -

• Kigali is the capital of Rwanda with a luxurious lifestyle. It is the hub of development with a population of 1.1 million. 
• Butare is the second most populous city in Rwanda, with a population of 89,600.
• Musanze or Ruhengiri is another popular and well-developed city in Rwanda with a population of 59,333. 
• Gisenyi is a beach city in Rwanda with a population of 86,323.

Top sectors expected to Hire

Foreign investment, foreign aid, and private and public establishments, generating jobs within a democratic and liberal environment, have supported rapid expansion in the Rwandan service sector. Banks, finance, software engineering, tourism, marketing, and the like have an ever-increasing demand for qualified professionals. Job portals have enlisted province wise vacancies and requirements for various skill sets such as IT, Education, Engineers, Software, IT professionals, Marketing, Communication etc.

Employment by numbers

72% of the working population is employed in agriculture, and 70% of the population is engaged in agriculture-based industries. The service sector employs 401,173 people, or 81.3 percent of all workers in Rwanda. The statistics favor developmental progress in the service sector in Rwanda. Rwanda is moving forward with technological and scientific strategizing.

Major skills and areas which have witnessed a recent growth rate

• IT Management
• Marketing, communication
• R&D
•  Project management
• Services
• Secretarial work, assistantship
• Production, maintenance, quality
• Accounting, controlling, finance
• HR, training
• Sales

Hiring Costs

Hiring costs refer to all the costs incurred by the hiring authority to hire an employee from start to end. It is usually calculated by cost per hire. The cost per hire is calculated by dividing the investment amount by the number of hires.

• The cost per hire comprises employment advertising, software, and relocation expenses, among other factors such as time and human resources involved. 
• Costs related to internal and external activities are calculated along with expenses related to training and onboarding. 
• In addition to hiring policies, human resources plans, growth and expansion, supply and demand, and the labour market are also important factors added to hiring costs.

Employment laws

Employees and employers in Rwanda are bound by their contracts and must honor them in good faith and according to law. Moreover, employment contracts include provisions dealing with termination and conflict resolution; it is up to both parties to refer to the court when conflicts arise. In a written contract, the parties and workplace must provide legal information, including their complete names and addresses.

• In addition to the job description, the length and nature of the contract and the probationary period and notice period should also be included. 
• The amount of pay, allowances, deductions, date and place of payment, overtime rate, etc. 
• It is necessary to update regulations and guidelines on collective labor and internal rules about employment category and occupation level. 
• Detailed information on weekly working hours and other provisions advantageous to the employer-employee relationship must be included.

How Can Skuad Help You with Hiring in Rwanda?

When you are organizing recruitment in Rwanda, you must have dedicated resources at your disposal. In the present times, when your focus should be on the optimization of resources, the hassles of recruitment act as a deterrent. Skuad offers you the services of highly experienced trainers to streamline your hiring process. Connect with Skuad Experts to know more.

FAQs

How to hire employees in Rwanda?

Companies can hire employees in Rwanda by establishing a local legal entity or using an Employer of Record (EOR). An EOR acts as the legal employer, managing employment contracts, payroll, social contributions, and compliance without a local entity.

What is the minimum wage in Rwanda?

Rwanda does not have a universal national minimum wage. Some sectors use industry-specific rates, often ranging from RWF 100 to RWF 5,000 per day depending on the role. Many employers follow market rates or collective agreements instead of a statutory floor.

What are the employment laws in Rwanda?

The standard workweek is 40 hours, typically Monday to Friday. Annual leave begins at 18 working days per year, plus one additional day for every three years of service. Maternity leave is 14 weeks (including prenatal), and paternity leave is 7 days, with additional leave in case of complications. Employees are entitled to up to six months of sick leave, with full pay for the first three months and unpaid leave afterward. Written contracts are required. Termination requires notice based on tenure and may involve severance payments.

How can a U.S. company pay employees in Rwanda?

A U.S. company can either set up a local entity and process payroll in Rwandan francs or use an EOR. The EOR handles salary payments, social security, tax filings, and ongoing compliance. Third-party payroll providers are also available for companies with a registered presence.

How do I obtain a work permit in Rwanda?

To hire a foreign national, the employer must obtain labor clearance from the Directorate General of Immigration and Emigration (DGIE). The employee then applies for a work permit and residence permit. Required documents include a valid passport, employment contract, proof of qualifications, police clearance, and medical certificate. Work permits are typically valid for one year and can be renewed.