Analysing the gap between what Georgia's education system produces and what the labour market demands. Why 34% of graduates work below their qualification level — and what to do about it.
| Field of Study | Annual Graduates | Estimated Annual Demand | Surplus / Gap |
|---|---|---|---|
| Law and Legal Studies | 4,200 | 800 | +3,400 surplus |
| Business Administration and Economics | 8,500 | 3,200 | +5,300 surplus |
| Social Sciences and Humanities | 6,800 | 1,100 | +5,700 surplus |
| Education (teachers) | 3,100 | 2,800 | +300 modest surplus |
| Computer Science and IT | 1,800 | 3,500 | -1,700 shortage |
| Healthcare (medicine, nursing) | 2,400 | 2,900 | -500 shortage |
| Engineering and Technical | 900 | 2,100 | -1,200 shortage |
| VET (skilled trades, technical) | 4,200 | 9,500 | -5,300 major shortage |
Georgia has a paradox: one of the highest tertiary education attainment rates in the South Caucasus (57% of 25-34 year-olds hold a degree) and one of the highest graduate underemployment rates (34% of graduates work in occupations below their qualification level). The education system is producing graduates the labour market does not need in the quantities it produces, while failing to produce the workers in occupations where demand is highest.
The data is stark: 15,000 annual graduates in law, business, and humanities face a labour market demand of approximately 5,100 positions in those fields. Meanwhile, the labour market has over 5,000 unfilled vacancies in IT, healthcare, engineering, and skilled trades — fields where Georgia produces only a fraction of needed graduates. The result: law graduates working in retail; IT companies importing talent; construction delayed by lack of qualified tradespeople.
The cost of mismatch is estimated at 3-4% of GDP annually in lost productivity (Cedefop 2022). Workers in mismatched occupations earn 25-40% less than in matching roles — a permanent wage penalty for a system failure. The mismatch also distorts investment: when universities see high enrolment in business (because students think business skills are universally applicable), they expand those programmes — reinforcing the mismatch cycle.
The education-labour market mismatch is not an accident — it is the predictable result of expanding university access without connecting it to labour market signals. Universities respond to student demand (social prestige of degrees) and government headcount-based funding; neither signal is aligned with employer needs. The solution is a skills feedback loop: employer demand data flows into education planning; education outcomes flow into ALMP targeting; ALMP outcomes flow back into employer engagement. GILS publishes the mismatch data transparently so that students, universities, employers, and policymakers can make better decisions. The alternative — allowing 34% graduate overeducation to persist while 5,300 VET positions go unfilled — wastes human capital on a national scale.
Amend state university grant allocation: cap state-funded places in humanities/law/social science at 60% of 2023 levels; expand state-funded places in IT, healthcare, and engineering by 50%. Revenue-neutral. Signals to students and universities that the state will not indefinitely fund surplus-producing programmes. 5-year phase-in prevents disruption.
Germany (Numerus Clausus + demand signals) · Estonia (state commission places by field) · Georgia MoES capacityVET deficit (5,300 annual positions) is the largest single mismatch. Double VET graduate capacity by 2027: (1) 20 new employer-led VET programmes in IT, construction, healthcare, logistics; (2) dual learning (60% workplace + 40% classroom) for all new VET programmes; (3) VET teacher salary parity with academic teachers; (4) GEL 45M capital investment in VET infrastructure.
Germany (dual VET system) · Austria (apprenticeship) · Georgia VET Strategy 2023All accredited university and VET programmes must have an Employer Advisory Board meeting at least twice yearly: 5 employers from relevant sector; binding input on curriculum, practical skills gaps, and graduate readiness. NAEC includes advisory board effectiveness in accreditation criteria. No legislative change required — implement through NAEC accreditation standards update.
UK (employer advisory boards) · Estonia (industry curriculum partnerships) · NAEC GeorgiaNo systematic data on what happens to Georgian graduates after graduation. Mandate: all state-funded universities report graduate employment outcomes (employed/unemployed/studying, occupation, salary band) at 1 and 3 years post-graduation. NAEC publishes as annual 'Graduate Outcomes Report' by institution and programme. Enables informed student choices — the most powerful demand-side correction.
UK (Graduate Outcomes Survey — mandatory) · Australia (QILT) · Estonia (graduate tracking system)Many workers have valuable skills gained informally (construction, agriculture, domestic work, IT) that they cannot certify, limiting formal employment and promotion prospects. Expand RPL: (1) 30-day assessment and certification for 50 priority occupations; (2) 100 ESDC-trained assessors; (3) employer recognition guaranteed for certified skills. Target: 10,000 RPL certifications annually by 2026 (from ~500 currently).
France (VAE — 70,000 certifications/year) · UK (APL accreditation) · Georgia ESDC Art.14| Convention / Standard | Subject | Ratified | Compliance | Key Gap |
|---|---|---|---|---|
| C142 | Human Resources Development | 1993 | Partial | VET misaligned with demand; employer engagement 34%; no graduate tracking |
| C122 | Employment Policy | 1993 | Partial | No skills forecasting system; education-employment alignment weak |
| Cedefop ESA | European Skills Agenda | DCFTA aligned | In progress | Skills intelligence system absent; RPL implementation at 500/year vs 10,000 target |