Overview
Active Labour Market Policy Framework
The Law on Promoting Employment (2020) establishes Georgia's active labour market policy (ALMP) framework, defining the mandate and functions of the Employment Support Department (ESDC) — the public employment service operating under the MLHSA. The ESDC operates worknet.ge (Georgia's official job matching portal), provides career counselling, manages vocational skills training, and runs targeted employment programmes for vulnerable groups.
The law replaced earlier fragmented employment promotion provisions and created a unified framework aligned with EU employment policy standards. It was adopted simultaneously with the 2020 Labour Code reform as part of Georgia's DCFTA Chapter 13 obligations.
Georgia's labour market faces structural challenges that active labour market policy must address: approximately 17.4% of the working-age population is labour underutilised (broader measure including discouraged workers and involuntary part-time); rural subsistence agriculture absorbs a large share; youth unemployment is 26.8%; and qualification mismatches between graduates and employer needs are severe.
Historical development
Building Georgia's Employment Service: 2006–2024
2006–2012
Minimal ALMP capacity. Employment service functioned primarily as benefit registry. Job matching was manual. No vocational training system. ILO assessments found Georgia had one of the lowest ALMP expenditure rates in Europe (0.04% of GDP vs EU average 0.6%).
2013–2017
ESDC established and expanded. Employment Support Department created 2013. worknet.ge portal launched 2014. First vocational skills development programme. DCFTA negotiations identified ALMP as key area requiring strengthening.
2018–2019
Youth employment focus. EU-funded Youth Employment Programme. ILO-supported programme design. ESDC regional offices expanded from 4 to 12. Employer engagement improved through vacancy posting incentives.
2020
Employment Law adopted — comprehensive ALMP framework. Unified legal basis. ESDC mandate expanded to include: career counselling, skills assessment, supported employment for vulnerable groups, returnee reintegration, disability employment. Target groups formalised: youth 15-29, IDPs, persons with disabilities, long-term unemployed, women returning from parental leave.
2021–2023
Scaling and COVID recovery. Temporary employment programmes expanded post-COVID (municipality employment, green economy jobs). ALMP expenditure increased to 0.11% of GDP (still very low by EU standards). 85,000 participants in 2023 vs 22,000 in 2019.
Chapter I — ESDC Mandate
Articles 1–5
ESDC Functions
Art. 1: Scope — labour market intermediation services to job seekers and employers. Art. 2: ESDC functions: (1) job matching and career counselling; (2) vocational skills development (up to 6 months, employer co-funded); (3) temporary employment programmes (6 months paid community service for long-term unemployed); (4) supported employment for vulnerable groups; (5) labour market information system; (6) employer engagement and partnership. Art. 3: Registration — job seekers register at ESDC to access services; employers register vacancies. Art. 4: Service standards — career counselling within 10 days of registration. Art. 5: Funding — state budget; EU/ILO/WB project funds; employer co-contributions.
GILS note: ESDC services are underutilised. Registration rate among unemployed is only ~35% — most unemployed Georgians do not use the public employment service because awareness is low and services are perceived as primarily for benefits rather than job placement.
Chapter II — Target Groups
Articles 6–11
Priority Groups for ESDC Support
Prioritised groups: (1) youth 15-29 not in employment, education, or training (NEET); (2) IDPs (internally displaced persons from Abkhazia and South Ossetia); (3) persons with disabilities; (4) long-term unemployed (12+ months); (5) women returning from parental leave; (6) former prisoners within 12 months of release; (7) returnee migrants; (8) rural population in high-unemployment municipalities. For each target group: dedicated counselling, skills assessment, and training pathways. Employers receive wage subsidy (50% of minimum wage for 6 months) for hiring from target groups.
GILS note: The 8 target groups are well-defined but ESDC resources are spread too thin. Recommended priority focus: youth NEET (largest group, highest long-term cost of inaction) and persons with disabilities (highest employment gap). Remaining groups through referral partnerships with NGOs.
Chapter III — Vocational Training
Articles 12–16
Skills Development Framework
Art. 12: ESDC may fund up to 6 months vocational training in partnership with accredited providers (colleges, employers, NGOs). Art. 13: Employer-led training — employer provides training, ESDC reimburses 70% of costs up to GEL 2,000/participant; employer commits to hire at least 80% of trainees. Art. 14: Recognised Prior Learning — ESDC assessors may certify skills gained informally, without formal training. Art. 15: Sectoral skills forecasting — ESDC publishes annual skills demand report. Art. 16: Digital skills — dedicated digital literacy programme for unemployed adults over 45.
GILS note: The employer-led training model (Art. 13) is the most effective ALMP tool — binding the training to actual job offers. However, the GEL 2,000 reimbursement cap is too low for technical skills training. Recommend increasing to GEL 5,000 for STEM and healthcare occupations.
Progress: ALMP participants increased from 22,000 (2019) to 85,000 (2023). worknet.ge now has 180,000+ registered vacancies. Employer-led training model showing 72% job retention at 6 months among graduates. Regional coverage expanded to 12 ESDC offices.
Gaps: ALMP expenditure 0.11% of GDP — far below EU average of 0.6%. Only 35% of unemployed use ESDC. Rural access poor — 12 offices for ~4,000 settlement coverage. Youth NEET rate (26.8%) among highest in EU neighbourhood. Qualification mismatch not addressed at sectoral level.
GILS Policy Recommendations
Five Priority Reforms
Recommendation 01
Increase ALMP expenditure to 0.3% of GDP by 2027
Current 0.11% is among the lowest in Europe. Target 0.3% (still below EU average but achievable in timeframe). Additional GEL 120M annually enables: 150,000 ESDC participants; expanded employer-led training; 1,000 supported employment placements; 20 additional regional counselling points. Funding source: 50% state budget, 50% EU IPA and World Bank employment project loans (both instruments currently available but underutilised).
EU average ALMP spend 0.6% · Moldova (0.35% target 2025) · World Bank Employment Project GeorgiaRecommendation 02
NEET early intervention programme
Youth aged 15-24 not in employment, education, or training (NEET rate: 26.8%) face the highest risk of permanent labour market exclusion. Outreach programme reaching NEETs through schools, social services, and community centres. Personalised action plan within 30 days of NEET identification. Options: return to education support; vocational taster programme (2-week); apprenticeship pathway; enterprise start-up microfinance (up to GEL 5,000 grant). EU Youth Guarantee model adapted to Georgian context.
EU Youth Guarantee (2013) · Slovakia (implementation model) · Georgia EU IPA Youth Employment Project 2022Recommendation 03
Expand worknet.ge with AI-matching capability
worknet.ge operates as a basic vacancy database. Investment of ~GEL 3M would enable: (1) skills-based matching (not just keyword search); (2) employer demand aggregation by sector/region for skills forecasting; (3) automated gap analysis — shows job seeker what training would close their qualification gap for target job; (4) mobile-first interface (67% of Georgian internet users access exclusively via mobile). Estonia's Tootukassa (unemployment insurance fund) digital platform is a direct replicable model.
Estonia (Tootukassa digital services) · Poland (Praca.gov.pl) · Georgia e-Gov PortalRecommendation 04
Rural employment activation
Rural Georgia has structural underemployment — subsistence agriculture masks joblessness. ESDC rural activation: (1) mobile counselling teams visiting villages quarterly in high-underemployment districts; (2) agricultural skills certification (FAO-supported); (3) rural enterprise development grants (GEL 3,000–15,000) co-financed with LEPL Produce in Georgia programme; (4) broadband digital skills training in rural community centres.
ILO rural ALMP framework · FAO/ILO joint rural employment programme · Georgia LEPL Produce in GeorgiaRecommendation 05
Employer incentive reform — wage subsidy to training subsidy
Current 50% wage subsidy for 6 months for hiring target group members costs approximately GEL 18M annually. Evidence shows wage subsidies have low deadweight (employers would have hired anyway) and poor retention after subsidy ends (only 45% still employed at 12 months). Redirect 50% of subsidy budget to employer-led training with 80% hire commitment (Art. 13 model) — which has 72% 12-month retention. Net saving of GEL 9M with better employment outcomes.
ILO ALMP effectiveness evidence · OECD Employment Outlook 2022 · Estonia wage vs training subsidy comparisonGeorgia's employment service has been transformed from a passive benefit registry to an active labour market institution. The remaining challenge is scale — reaching the 65% of unemployed who do not currently use ESDC, particularly young people and rural communities, before long-term unemployment becomes structural exclusion.
— GILS Research Position Paper on Active Labour Market Policy, September 2026| ILO Convention | Subject | Ratified | Compliance | Key Gap |
|---|
| C088 | Employment Service | o | a | 35% unemployed use service; rural access inadequate |
| C181 | Private Employment Agencies | o | a | Private agencies supplement but not integrated with ESDC |
| C122 | Employment Policy | o | a | ALMP expenditure 0.11% vs ILO recommended 0.3-0.5% |