The Policy and Management Consulting Group (PMCG) has published a review of the Georgian labor market, according to which the unemployment rate remains more than double the EU average.
BM.GE offers the main findings of the review:
Pre- vs Post-Pandemic Comparison (2019 vs 2025)
• Labor Market Developments: The labor market in Georgia showed notable improvements in Q1 of 2025 compared to Q1 of 2019. The employment rate (+4.6 percentage points (pp)) and labor force participation rate (+2.2 pp) increased, while the unemployment rate dropped (-5.0 pp). However, the unemployment rate remains more than double the EU average.
• Labor Force Dynamics: In Q1 of 2025, the number of people in the labor force grew by 2.5% compared to Q1 of 2019, primarily due to an 8.9% increase in employment, while unemployment decreased by 23.6%. Simultaneously, the population outside the labor force declined by 6.1%, likely driven by increased labor force participation and, to some extent, by emigration from the working-age population.
• Salary Dynamics: From Q1 of 2019 to Q1 of 2025, nominal salaries nearly doubled, rising from 1,093 GEL to 2,170 GEL. However, when adjusted for inflation, real salaries showed a more modest increase—from around 900 GEL to 1,300 GEL.
• Gender and Urban-Rural Gaps: From Q1 of 2019 to Q1 of 2025, a persistent gender gap remains, with female labor force participation averaging 21.5 percentage points lower than that of men. Similarly, urban areas continue to exhibit higher labor force participation than rural areas, though the gap narrowed postpandemic.
Recent developments
• Salary Distribution: From 2021 to Q1 of 2025, the number of people earning up to 600 GEL fell significantly, while the number of those earning over 2,400 GEL nearly doubled. The salary growth was concentrated in number of people earning between 1,200 and 2,399 GEL and those earning 2,400 GEL or more.
• Labor Demand and Vacancies: Job vacancies increased postpandemic but began to decline in late 2024 and early 2025, likely due to political developments in Georgia.
• Beveridge Curve: In Q1 of 2025, compared to Q1 2024, labor market efficiency slightly increased as both the unemployment rate and the job openings rate declined slightly.
• Business Expectations: In Q1 of 2025, surveyed businesses maintained a generally positive outlook. However, expectations declined compared to previous periods.
• Salaries and Employment Outlook: In Q1 of 2025, 40% of surveyed companies reported salary increases, primarily within the 0–20% range. However, only 18% indicated expectations for further increases in Q2. Additionally, 23% of businesses reported workforce growth in Q1, while 29% anticipate employment growth in Q2.
2024 Overview
• Labor Underutilization: The labor underutilization rate, which includes unemployment, underemployment, and the potential labor force, more than twice as high as the unemployment rate in 2024, highlighting persistent inefficiencies.
• Sectoral Employment Trends: In 2024, the largest shares of employed individuals were in trade, agriculture, industry, and education. All of these sectors experienced employment growth compared to 2019, except for agriculture, which saw a decline of 9.1%.
• Employment of Foreign Nationals: As of September 1, 2024, 7% of enterprises in Georgia employed 18,935 foreign nationals (2% of the total workforce)*. The majority of them were employed in the Information and Communication sector (38%), followed by Construction (14%) and Accommodation and Food Services (7%).
