Youth Unemployment in Georgia: Falling Rates, Shrinking Participation — Why the Headline Hides an Exit

GILS Research Team

Editor: Prof. Giorgi Pkhakadze, MD, MPH, PhD

Georgian Institute of Labour Studies · Data & Wages

7 September 2026

Georgia’s youth unemployment rate (ages 15–24) fell from 39.4% in 2020 to 34.5% in 2023. At first sight this is good news. But over the same period the number of employed young people did not rise — it fell. Youth unemployment declined mainly because young jobseekers left the labour force, through emigration or extended study. This analysis argues that falling youth unemployment in Georgia is, to a significant degree, a story of exit rather than inclusion.

Correction, 2 October 2026: an earlier version of this analysis gave the 2023 youth unemployment rate as 32%. Geostat’s data by age group give 34.5% for 2023; 32.0% is the rate for 2025. The conclusions are unchanged.

1. Introduction

Youth unemployment is one of the labour market indicators with the longest-lasting consequences. Research in several countries has shown that unemployment early in a working life can reduce earnings and employment prospects for many years afterwards — the so-called “scarring” effect (Bell and Blanchflower, 2011; Gregg and Tominey, 2005). A falling youth unemployment rate is therefore usually welcomed.

This analysis asks whether the decline in Georgia’s youth unemployment since 2020 reflects young people finding work, or something else. Our thesis is that it mostly reflects something else: a shrinking youth labour force, driven by emigration and by young people choosing education over a labour market that offers them few compatible jobs. If that is right, the policy priority is not to celebrate the falling rate, but to address why young people are leaving the labour market — and in many cases the country.

2. Data and Definitions

This analysis uses Geostat Labour Force Survey indicators for the 15–24 age group, as compiled and analysed by PMCG Research (2024), together with Geostat’s 2024 annual labour force release (Geostat, 2025) and a World Bank study of young people not in employment, education or training (World Bank, 2019).

The youth unemployment rate is the share of the youth labour force — young people working or actively seeking work — who are unemployed. Because the denominator is the labour force rather than the youth population, the rate can fall if unemployed young people stop searching or leave the country, even if no new jobs are created. This is why the youth employment rate and the absolute number of employed young people are essential complements to the unemployment rate.

3. Findings

3.1 The rate fell; employment did not rise

Source: Geostat, compiled by PMCG Research (2024). Change column is a GILS calculation.

The arithmetic is clear. Unemployed youth fell by about 12,000, but employed youth fell by about 4,000. The unemployment rate dropped because the labour force shrank faster than the number of unemployed — not because jobs were created for young people. PMCG Research (2024) concludes that a considerable number of young people who left the country between 2020 and 2023 were unemployed jobseekers, and that others chose to continue studying rather than enter the labour market.

The youngest workers face the hardest conditions. In 2024, the unemployment rate for 15–19-year-olds was 36.3%, the highest of any age group in Georgia (Geostat, 2025).

3.2 Fewer NEETs — but for the wrong reason

The share of young people neither working nor studying fell from 29% in 2020 to 21% in 2023. This is a genuine improvement, but its source matters. Over the same period the share of young people studying and not working rose by 8 percentage points, from 51% to 58%. The fall in NEETs was therefore driven by more young people staying in education — while the share working remained flat. Georgia’s NEET rate in 2023 remained around 5 percentage points above the EU average (PMCG Research, 2024).

An earlier World Bank study, using the broader 15–29 age range, found that 31% of young Georgians were NEET, that NEET rates were consistently higher among young women than young men, that inactivity in the form of homemaking and caregiving was the most common condition among female NEETs, and — strikingly — that NEET rates among higher education graduates were higher than among those with less education, particularly for women (World Bank, 2019). The study described this as a strong sign of mismatch between the supply of graduates and the demand for skilled labour.

3.3 A labour market without room for students

One reason young people choose between study and work, rather than combining them, is the near-absence of part-time jobs. Only 9% of employed young people in Georgia worked part-time in 2023, against an EU average of 33%. Only 7% of young people worked and studied at the same time, and only 10% of those in education had a job (PMCG Research, 2024). Full-time jobs are often incompatible with university study, so young people are forced to choose — and many choose education, postponing labour market entry.

3.4 Low pay and gender gaps

Young people who do work earn considerably less. Over 2020–2023, average youth salaries in the formal sector were about 35% below those of the working-age population. Youth employment remains concentrated in agriculture and in wholesale and retail trade, where average salaries are 50% and 19% below the national average respectively (PMCG Research, 2024).

Gender differences are persistent. Young women’s labour force participation was on average 14 percentage points below young men’s over 2020–2023. Youth unemployment fell by 7 points for young men but by only 1 point for young women, and a youth gender pay gap of about 8% emerged by 2023 where none existed before the pandemic (PMCG Research, 2024).

4. Discussion

Argument 1: The headline rate rewards exit

Because the unemployment rate is calculated on the labour force, it improves when unemployed young people leave — whether by emigrating, giving up searching, or returning to education. In Georgia between 2020 and 2023, all three appear to have contributed. A falling youth unemployment rate in these circumstances is not evidence that the labour market has become more inclusive. Policymakers should track the youth employment rate and the absolute number of young people in work as primary indicators.

Argument 2: Emigration of young jobseekers is a loss, not a solution

When unemployed young people emigrate, unemployment statistics improve, but the country loses part of the cohort on which its future labour supply, tax base and pension system depend. This is particularly serious in a country whose working-age population is already declining.

Counter-argument: more education is a good outcome

The rise in young people studying is, in itself, positive. Higher educational attainment raises long-term productivity and protects against informality — in Georgia, informal employment falls below 20% among people with tertiary education (Pignatti, 2026). We agree. But the World Bank’s finding that NEET rates are higher among graduates than non-graduates suggests that more education alone does not guarantee a transition to work. The problem is not that young people study; it is that the labour market does not allow them to combine study with work, and does not absorb enough of them after graduation.

Counter-argument: rural youth are the main problem

It is often assumed that youth labour market problems in Georgia are concentrated in rural areas. The evidence does not support this. In 2023 there was no significant difference in youth labour force participation between rural and urban areas, and urban areas had higher overall unemployment than rural areas in most recent years (PMCG Research, 2024). The World Bank (2019) found the NEET phenomenon to be mostly urban. Youth policy should therefore not be framed primarily as rural development policy.

5. Limitations

Youth indicators are based on survey samples and may be affected by emigration over the period. Some figures are reported only for selected years. The World Bank NEET study uses an older reference period and a different age range (15–29) from the PMCG analysis (15–24). Formal-sector salary data exclude informal employment, which is especially common among the youngest workers.

6. Conclusion

Georgia’s youth unemployment rate has fallen, but the number of young people in work has not risen. The improvement reflects a shrinking youth labour force — through emigration, extended education and withdrawal — rather than an expanding supply of jobs for young people. The structural barriers are clear: very few part-time jobs, low youth pay, a persistent gender gap and a weak transition from higher education to skilled employment. Georgia should measure youth labour market success by how many young people are working, learning, and staying — not by how many have stopped being counted as unemployed.

GILS analyses are prepared with AI-assisted drafting. All figures and claims are verified against the cited primary sources and reviewed under the responsibility of the Editor.