=Paper=
{{Paper
|id=Vol-3364/paper01
|storemode=property
|title=Economic analysis of factors associated with education and employment
|pdfUrl=https://ceur-ws.org/Vol-3364/paper01.pdf
|volume=Vol-3364
|authors=George Abuselidze,Gia Zoidze
|dblpUrl=https://dblp.org/rec/conf/cte/AbuselidzeZ22
}}
==Economic analysis of factors associated with education and employment==
https://ceur-ws.org/Vol-3364/paper01.pdf
Economic analysis of factors associated with
education and employment
George Abuselidze1 , Gia Zoidze1
1
Batumi Shota Rustaveli State University, 35 Ninoshvili Str., Batumi, 6010, Georgia
Abstract
The purpose of the research is to determine and analyze the current situation in the Georgian economy,
labor market requirements, existing workforce structure, main challenges and trends. Important studies
were conducted, within the framework of which market requirements were analyzed, consultations
were held with experts in the field, employers, representatives of the Center for the Development of
the Quality of Education; The present situation of supply and demand in the educational market is
studied and analyzed. Qualitative and quantitative studies were also conducted, within the framework of
which the following were identified: the compatibility of higher education programs with the market
requirements, the inclusion of practical components in the educational process, the relationship between
higher educational institutions and students, and the processes of interaction between education and
the labor market. We think that the promotion of professional education will definitely lead us to the
desired results, both from the point of view of the economy of Georgia and the general situation in the
country. There is simply a need for more involvement from the state and, accordingly, more properly
conducted measures, raising the level of awareness in society and creating all the prerequisites in order to
change the attitude towards vocational schools as positively as possible. All this will eventually become
a contributing factor for improving the level of education or the economic situation. The study concludes
with findings and suggestions, which cover the issues facing the Georgian labor market and the labor
force demand vision. The examination of the influence of higher education on employment and income
in Georgia demonstrates that the investment in higher education yields a discernible return at this point,
but the human capital developed in the higher education system is still not being employed efficiently in
the country.
Keywords
economic effect of education, labor market, factors associated with education and employment, impor-
tance of professional education for the economy, rate of public return of higher education
1. Introduction
In general, the countries have been giving more and more importance to education in the recent
period, and accordingly they will pay more expenses for the latter as possible. Why is this
happening? The answer is that education is a kind of investment in the creation of human
capital. Simply put, the state will pay for the education of a specific person today because it
will benefit from this person in the future, it may be performing a specific job, participating in
technological progress, introducing innovations or any other form that has a positive impact on
the economic and general environment of the country.
CTE 2022: 10th Workshop on Cloud Technologies in Education, May 23, 2022, Kryvyi Rih, Ukraine
" george.abuselidze@bsu.edu.ge (G. Abuselidze)
0000-0002-5834-1233 (G. Abuselidze); 0000-0002-0155-5775 (G. Zoidze)
© 2023 Copyright for this paper by its authors. Use permitted under Creative Commons License Attribution 4.0 International (CC BY 4.0).
CEUR
Workshop
Proceedings
ceur-ws.org
ISSN 1613-0073
CEUR Workshop Proceedings (CEUR-WS.org)
24
To some extent, differences in education levels can also explain differences in income between
countries, but not always. The truth is that a high level of education also indicates a high level
of economic development and growth of the country. However, since there are many other
factors that have a noticeable impact on the economy, a high level of education alone is not
enough to maintain its good condition. Even if we ignore the influence of other factors, it is still
an issue that deserves our attention. Having the necessary resources (in this case, we mean a
high level of education) does not indicate guaranteed good results, it is necessary to give these
resources the right direction and use them effectively.
To better understand the relationship between education and economy, here we can briefly
talk about the factors that have been identified by researchers over time and which have a direct
impact on the country’s economy:
• Education increases the potential for innovation, which creates the basis for economic
growth;
• Educated workforce is highly productive (easily assimilates technologies) and therefore
contributes to the growth and development of the economy;
• By investing in education, a better environment is created for technological develop-
ment, which naturally has a positive impact on the increase in labor productivity and,
accordingly, on the economy.
Here, as an example, we cite the research of Krueger and Lindahl [1], which meant the
creation of such a tool that would make it possible to compare school years with economic
growth. The result of this was the following: from one additional year of education, more than
10% gains were received. Despite the shortcomings that accompanied such measurement, it is
still possible to create a certain idea about the relationship between education and economic
growth.
Also, we can consider the method of Hanushek and Woessmann [2], which was about
comparing the quality of education and economic growth by countries. TIMSS and PISA tests
were used in the method, and the observation finally showed that high results of the tests
indicated an appropriate expression of economic growth in percentages of GDP.
The study of the economic effect of education has become particularly noteworthy since the
1980s and 1990s, due to the wage inequality in different countries. According to international
studies on the assessment of individual educational outcomes, for each additional year of
formal education, the world average of individual financial outcomes increases by 10% [3].
It is significant that the highest coefficient of economic growth is recorded in the case of
countries with low and middle income (10.9 and 10.7 respectively). In high-income countries,
the coefficient of growth is 7.4.
It is also worth noting that over the last 12 years, the amount of education gaps has decreased
by 0.6%, as access to formal education has increased worldwide and, therefore, the average
number of years of formal education (especially in countries with strong economies). This
circumstance leads to the strengthening of competition in local labor markets based on the
supply of human resources in excess of the existing demand, and also to the proliferation
of low-income jobs, which, in turn, lowers the individual financial benefits of education [4].
Therefore, finance for human capital is typically considered as an investment aimed at enabling
25
individuals to fully participate in economically productive activities in order to make a livelihood
[5, 6, 7, 8, 9, 10, 11, 12, 13]. To do this, the student must be transformed from a passive consumer
of knowledge into an active creator of knowledge. Continually enhance ability to apply new
information to practical situations in order to advance critical technical, financial, socioeconomic,
legal, and management procedures; to increase own and society’s capacity for economic activity
via social responsibility and collaboration [14].
As a result, the article examines the present trends in employment and unemployment in
the country, covering industry and age. The labor market’s demand component has been
investigated, and the key sectors with especially strong economic activity have been identified,
which is one of the required criteria for the expansion of employment in these areas.
2. Methods
Important studies were conducted, within the framework of which market requirements were
analyzed, consultations were held with experts in the field, employers, representatives of
the Center for the Development of the Quality of Education; the present situation of supply
and demand in the educational market is studied and analyzed. Qualitative and quantitative
studies were also conducted, within the framework of which the following were identified: the
compatibility of higher education programs with the market requirements, the inclusion of
practical components in the educational process, the relationship between higher educational
institutions and students, and the processes of interaction between education and the labor
market. Furthermore, our research involves an examination of job searchers and jobs listed on
the website of a private recruitment agency.
The topic of the research concerns 3 main issues:
1. Demand/supply analysis for selected higher education programs.
2. Determination of labor market requirements and challenges.
3. The importance of professional education for the economy.
This paper presents a study of the economic benefits of higher education (educational return)
in the population of Georgia from a microeconomic perspective, in order to evaluate the
personal/individual benefits (monetary benefits) of investment in education in the form of
years and the impact of higher education on employment opportunities. As we have already
mentioned, individual education gains show how much an individual’s income increases (or does
not increase) according to the number of years spent on formal education. Mincer’s “income
equality” is considered one of the most common methods for determining this relationship, and
variables such as, first of all, the possibility of employment, as well as professional growth and
advancement, job stability, the degree of autonomy in the work process, and so on, are used to
determine non-monetary benefits [15]. After that, overall, it affects job satisfaction.
26
3. Results and discussion
3.1. The main challenges of the Georgian labor market
In post-communist countries, where economic reforms started relatively late, the restructuring
of the labor market took place differently from developed economies, where employment
increased in contradictory directions, in particular, requiring high and low qualifications. In
Georgia and other post-Soviet countries, the number of medium and low-skilled jobs has
increased, and there has been an increase in such activities where there is a high demand for
physical skills, for example, construction, the service sector, transportation, wholesale and
retail trade. Such transformations of the labor market in post-communist countries led to the
devaluation of the quality of education, knowledge and competencies of the largest part of the
adult population (credential inflation), considering that post-communist countries (including
Georgia) are characterized by a high share of the population with university education [16].
Ultimately, this was reflected in high rates of highly skilled labor force, as the population
with higher education diplomas agreed to do low-skilled jobs [17]. At the same time, the
workforce of the older generation is not equipped with the knowledge or skills corresponding
to the requirements of the modern market, which, in turn, is an expression of the problem of
knowledge devaluation. In general, the mentioned part of the labor force remains “downgraded”
in the national labor market in workplaces with low productivity, where the possibility of
professional development is minimal, and those with lower competences become unemployed
[18, 19, 20].
The process of “downgrading” is strengthened by the fact that in post-communist countries
the number of university graduates is constantly increasing, which exceeds the country’s
economic capabilities. As a result, on the one hand, there is an imbalance in the labor market in
terms of demand and supply of labor force, and on the other hand, the aging labor force is being
replaced by a new generation, which also accepts low-skilled work. As a result, competition in
the existing limited market increases and the aging workforce moves into even lower-level jobs
or into the unemployed category.
Overall, an aging or young labor force that does not have modern education and skills hinders
the adoption of new technologies in the labor market, the development of innovative work
areas and the growth of productivity at the macroeconomic level of the country [21]. This is
because a strong, educated workforce has the necessary information, abilities, and skills that
potential employers are looking for [22].
Employment of young people is one of Georgia’s major labor market issues. Young individuals
aged 15 to 24 in particular stand out as having a very high proportion of unemployment (figure 1).
This is determined by several factors. In Georgia, most young individuals in the work field
have a higher education, and after finishing their studies, they confront the following sorts of
problems:
1) There is no demand in the labor market for the professions they have learned,
2) The profession they have mastered is a highly competitive profession,
3) And/or their credentials and work experience do not fulfill labor market standards. Further-
more, the percentage of frictional unemployment should be included in this group, because
27
higher education, and after finishing their studies, they confront the following sorts of problems:
1) There is no demand in the labor market for the professions they have learned,
2) The profession they have mastered is a highly competitive profession,
3) And/or their credentials and work experience do not fulfill labor market standards.
Furthermore, the percentage of frictional unemployment should be included in this group, because
young people require longer time to obtain the desired work, taking into consideration a variety of
reasons.
60,0
50,0
40,0
30,0
20,0
10,0
0,0
15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65+ სულ
Unemployment rate, 2020, % Unemployment rate, 2021, %
Figure 1: Unemployment rate by age groups, data for 2020 and 2021.
Figure
Source:1: Unemployment
National Statistics rate byof
Office age groups,2021
Georgia, data[23].
for 2020 and 2021 [23].
In addition, one of the main challenges of the Georgian labor market is demographic aging, which
young
directly people
affects therequire longer
distribution time
of the to obtain
labor force inthe thedesired
market work, takingtheinto
and creates consideration
need to assess howa
variety of reasons.
capable the existing human capital is now or will be in the future to produce tangible or intangible
benefits for the country [24].
In
Anaddition, one of the
aging workforce main challenges
is associated of the Georgian
with declining labor and
health, physical market is demographic
mental capabilities, asaging,
well
as reduced adaptive behavior to a changing work environment, devaluation
which directly affects the distribution of the labor force in the market and creates the need of knowledge, and overall,
a decline in productivity [25]. Taking into account all these factors, the productivity of the labor force
to assess how capable the existing human capital is now or will be in the future to produce
increases, on average, until the age of 40, and then begins to decline. Despite such a generalized
tangible
reasoning,orthe intangible benefits
international for the
literature alsocountry
discusses[24].
types of activities that have a positive correlation
with the aging of the workforce or are not at declining
An aging workforce is associated with all related health,
[26]. Forphysical
example,and mental
in the case capabilities,
of a doctor and as
well as reduced
a lawyer, adaptive behavior
labor productivity increasestowitha changing
age; Thework laborenvironment,
productivity ofdevaluation
bank clerksofand knowledge,
electrical
and overall,
engineers doesa decline in productivity
not depend on age, however, [25]. Taking into account
the productivity all these factors,
of construction workers thedecreases
productivity
with
age [27, 28].
of the labor force increases, on average, until the age of 40, and then begins to decline. Despite
In jobs that require problem-solving and fast-acting skills, productivity declines with age, while in
such a generalized reasoning, the international literature also discusses types of activities that
jobs that prioritize experience and verbal skills, an older workforce maintains high levels of
have a positive
productivity [29].correlation
Acceptable with theeconomic,
current aging of technological
the workforce andororganizational
are not at allinnovations
related [26,arep. also
150-
152]. For example, in the case of a doctor and a lawyer, labor productivity
taken into account, which lead to frequent changes in work requirements and due to which the increases with age;
the laborofproductivity
weights a number ofoffactors bank clerks and electrical
determining engineersofdoes
the productivity the not depend(physical
workforce on age, however,
abilities,
the
mentalproductivity of construction
abilities, level of education, workers decreases
work experience) alsowith agein
change [21,
the27].
modern labor market [30].
It is
Indifficult
jobs that to say with problem-solving
require certainty what impact andthe rapidly transforming
fast-acting labor market
skills, productivity will have
declines onage,
with the
workforce of different age groups [31]. However, due to the fact that technological development
while in jobs that prioritize experience and verbal skills, an older workforce maintains high
reduces the demand for physical work in the modern labor market, it is expected that the workforce of
levels
the older of age
productivity
group will [28].
be able Acceptable
to maintaincurrent economic,under
high productivity technological
innovative and organizational
management, which
innovations
will take careare alsotargeted
of the taken into account,
updating of thewhich lead toand
knowledge frequent
skills ofchanges in workregardless
the workforce, requirements
of its
and due to which
age indicators [32]. the weights of a number of factors determining the productivity of the
workforce (physical abilities, mental abilities, level of education, work experience) also change
in the modern labor market [29].
It is difficult to say with certainty what impact the rapidly transforming labor market will
have on the workforce of different age groups [30]. However, due to the fact that technological
development reduces the demand for physical work in the modern labor market, it is expected
that the workforce of the older age group will be able to maintain high productivity under
innovative management, which will take care of the targeted updating of the knowledge and
skills of the workforce, regardless of its age indicators [31].
28
3.2. Factors associated with education and employment
Also, the results of the OECD 2016 report on economic structures by education field are in-
teresting. Engineering and construction are associated with higher financial benefits; Social
Sciences, Business and Law; Exact, natural and computer sciences. The financial benefits of
those educated in the above-mentioned fields are, on average, 10% higher than the benefits of
other graduates. As for university graduates in pedagogy, education and humanities, as well as
language and arts, their financial benefit is 15% less than the average income [19].
In addition, it is important to observe the distribution in the labor market according to their
education. The research results reveal that:
• The share of hired employees with higher education is high in the education system (82%),
complex office/administrative (81%) and finance/banking/insurance (86%) fields;
• Employees with school education represent the majority in defense and security (82%),
production (57%) and construction (61%);
• Employees with professional education dominate in wholesale and retail trade (38%), as
well as in individual services (43%).
Along with the factors related to education, the factors associated with the employment
market are no less important. This refers to the number and types of vacancies in the market
[32, 33].
In 2021, according to the results of the labor market demand component survey conducted in
Georgia, trade, repair of cars and household items, restaurants and hotels, metallurgical industry,
individual services are the economic activities in which employers experience a shortage of
personnel [34]. There is a special demand for teachers and healthcare professions in the regions.
However, despite the existing differences, there is a demand for accountants, waiters, sales
assistants in all regions of Georgia (including Tbilisi). Therefore, our research also includes
the analysis of job seekers and vacancies registered on the website of the private employment
agency (hr.ge). According to Hr.ge, more specifically, what positions are in demand, is given in
figure 2 [35].
Regarding the labor force recruitment problems, the majority of the employing organizations
point out that there is a shortage of specific and necessary personnel in Georgia and that the
applicants do not have the relevant skills for the job positions. Sales and marketing managers,
confectioners, bank cashiers, teachers, journalists and others are among the deficient professions.
According to the ISCO-08 classification [36], the above-mentioned positions are mostly
combined in the service and sales, individual service fields, as well as in the category of
artisans/related workers and education professionals. Taking this into account, it is interesting
to see what field of study graduates predominate in Georgia today and how professional
preferences change over time (figure 3).
According to the 2022 data of the National Statistics Office of Georgia, among the under-
graduate graduates of both state and private universities, the majority are graduates of social
sciences, business and law. These programs have maintained their leading position since 2011.
Educational programs related to the field of service and engineering and construction fields in
both state and private universities are characterized by an increasing number of graduates. A
downward trend is evident in the case of health and social service programs and agricultural
education programs.
29
individual services are the economic activities in which employers experience a shortage of personnel
[35]. There is a special demand for teachers and healthcare professions in the regions. However,
despite the existing differences, there is a demand for accountants, waiters, sales assistants in all
regions of Georgia (including Tbilisi). Therefore, our research also includes the analysis of job
seekers and vacancies registered on the website of the private employment agency (hr.ge). According
to Hr.ge, more specifically, what positions are in demand, is given in Figure 2 [36].
12 000 30,0%
10 000 25,0%
8 000 20,0%
6 000 15,0%
4 000 10,0%
2 000 5,0%
0 0,0%
Quantity %
Figure
Figure2:2:Vacancies
Vacanciespublished
publishedon
onHr.ge
Hr.geby
bymain
mainprofessional
professional groups,
groups, 2020.
2020 [34, 35].
Source: Ministry of Economy and Sustainable Development of Georgia. 2021; Official website of the
employment agency: www.hr.ge [35, 36]
3.3. The importance of professional education for the economy
In general, the functioning of the economy is significantly influenced by the level of unemploy-
ment. A high level of unemployment can have a very noticeable and negative impact on the
economy and, accordingly, on the standard of living of the society [38]. It is associated with
low incomes, low incomes in turn indicate deterioration of living standards and reduction of
consumption [39, 40]. Reduced consumption naturally also has a negative impact on output: no
demand, no supply. The reduced output further increases the ranks of the unemployed, and so
endlessly, if it were not for the various measures taken by the state and the fight against the
mentioned challenges [41, 42, 43].
Unfortunately, vocational education in Georgia is not in a very good condition, more and
more people reach higher education institutions, and less and less people remain in the ranks of
those wishing to receive vocational education [22, 44]. This ultimately leads to the fact that we
have too many graduates of higher educational institutions in the country, whose employment
is physically impossible [45].
What will happen if the number of applicants is properly distributed between professional
and higher education institutions? We think that the better the conditions for professional
education, the more people will be interested in it, and all this will have a positive effect on
the level of unemployment. We are talking about the case when the redistribution of people
with higher and professional education will be logical, the demand for vocational schools will
increase and there will be a correct match between vacant places and working people [46, 47].
30
cashiers, teachers, journalists and others are among the deficient professions.
According to the ISCO-08 classification [37], the above-mentioned positions are mostly combined
in the service and sales, individual service fields, as well as in the category of artisans/related workers
and education professionals. Taking this into account, it is interesting to see what field of study
graduates predominate in Georgia today and how professional preferences change over time (Figure
3).
40 000
35 000
30 000
25 000
20 000
15 000
10 000
5 000
-
2017 2018 2019 2020 2021 2022
Figure
Figure3:3:Number
Numberof
ofstudents
students in state higher
higher educational
educationalinstitutions
institutionsaccording
accordingtotoprograms
programs.
[37].
Source: National Statistics Office of Georgia, 2022 [38].
However,
According everything
to the 2022considered
data of theisNational
not so simple,
Statisticssince vocational
Office education
of Georgia, among thefaces various
undergraduate
problems and challenges [48].
graduates of both state and private universities, the majority are graduates of social sciences, business
andIflaw. These programs have maintained their leading position since 2011. Educational
we ignore unemployment (which is quite difficult in the case of Georgia), those professions, programs
related to the field of service and engineering and construction fields in both state and private
which vocational schools provide the opportunity to master, are quite important for the economy.
universities are characterized by an increasing number of graduates. A downward trend is evident in
It iscase
the goodof to haveand
health higher
socialeducation, it is good
service programs andtoagricultural
create the basis of technological
education programs. progress and
to increase the degree of innovation, but all this also requires graduates of vocational education
programs.
3.3. The importance of professional education for the economy
We can cite a simple example to better understand the role of professional education. We
know that the state will spend resources on education, on the other hand, the individual also
In general, the functioning of the economy is significantly influenced by the level of unemployment.
Aspends money
high level and time on education,
of unemployment can have but often
a very the costs
noticeable andincurred
negativeare more,onand
impact thethe benefits
economy and,
received are less [49, 50, 51]. This may be due to the education system, less
accordingly, on the standard of living of the society [39]. It is associated with low incomes,effort of the studentlow
himself or
incomes in some other reason.
turn indicate However,
deterioration of the factstandards
living that expenses were spent
and reduction of on education at
consumption the41].
[40,
initial stage does not change. At this time, we reach a situation where the expenses and time
spent are in vain.
Vocational education requires (in most cases) less costs and, most importantly, less time. As
31
good to have higher education, it is good to create the basis of technological progress and to increase
the degree of innovation, but all this also requires graduates of vocational education programs.
We can cite a simple example to better understand the role of professional education. We know that
the state will spend resources on education, on the other hand, the individual also spends money and
time on education, but often the costs incurred are more, and the benefits received are less [49-51].
This may be due to the education system, less effort of the student himself or some other reason.
However, the fact that expenses were spent on education at the initial stage does not change. At this
for the
time, we results, it is entirely
reach a situation wherepossible for a and
the expenses person
timewith
spentaarevocational
in vain. education to have more
income, be able
Vocational to do more
education work,
requires (in and
mosttherefore
cases) lessbenefit
costs the
and,economy and themselves
most importantly, more
less time. As than
for the
a person
results, it iswith a higher
entirely education
possible couldwith
for a person [52].aTherefore,
vocational we believetothat
education have professional
more income, education
be able to
do morea work,
plays and therefore
very important rolebenefit
in thethe economy
growth and and themselvesofmore
development than a person
the country’s with a and
economy, higher
education
even more so in the effective distribution of resources (which is naturally accompanied by the in
could [53]. Therefore, we believe that professional education plays a very important role
the growth and development of the country's economy, and even more so in the effective distribution
improvement of the economy) [53].
of resources (which is naturally accompanied by the improvement of the economy) [54].
Basedon
Based onthe
therecent
recent(2013-2021)
(2013-2021)datadataofofthetheNational
National Statistics
Statistics OfficeofofGeorgia,
Office Georgia,wewe can
can con-
conclude
clude that the number of people enrolled in vocational schools is characterized
that the number of people enrolled in vocational schools is characterized by a decreasing trend, whichby a decreasing
istrend, whichgood.
not really is notThe
really good. of
number The number ofinstitutions
educational educationalthatinstitutions
accepted that accepted
students students
for professional
for professional
programs programs
also decreased. also
The decreased.
decrease in the The decrease
number in the number
of students enrolledofinstudents
vocationalenrolled in is
schools
vocational
shown schools
in Figure 4. is shown in figure 4.
25 000
20 000
15 000
10 000
5 000
-
2013 2014 2015 2016 2017 2018 2019 2020 2021
Figure
Figure4:4:Admission
Admissionofofstudents
studentsto
toprofessional programs,2013-2021
professional programs, 2013-2021.
[54].
Source: National Statistics Office of Georgia, 2021 [52]
It should be noted that over the years, a large part of the demand for vocational schools of
Georgia came from the older population, and this demand from the students was quite small,
although recently the situation is changing and by 2021, 60% of the population under the age of
26 will be enrolled in vocational schools. Figure 5 allows us to make the mentioned conclusion,
where the data of 2021 on students enrolled in vocational schools, divided by age groups, are
presented.
We think that the promotion of professional education will definitely lead us to the desired
results, both from the point of view of the economy of Georgia and the general situation in the
country. There is simply a need for more involvement from the state and, accordingly, more
properly conducted measures, raising the level of awareness in society and creating all the
prerequisites in order to change the attitude towards vocational schools as positively as possible.
All this will eventually become a contributing factor for improving the level of education or the
economic situation [55].
In general, we believe that the promotion of vocational education, especially in the case of
Georgia, will be one of the means for reducing the unemployment level and for the effective
32
came from the older population, and this demand from the students was quite small, although recently
the situation is changing and by 2021, 60% of the population under the age of 26 will be enrolled in
vocational schools. Figure 5 allows us to make the mentioned conclusion, where the data of 2021 on
students enrolled in vocational schools, divided by age groups, are presented.
up to 15 years
0%
33+
23%
15-20
35%
27-32
17%
21-26
25%
Figure 5: Distribution of students in vocational schools by age, 2021 [54].
Figureformation
5: Distribution of students
of the labor market. in vocational
However, schools
despite bythat
the fact age,professional
2021. education is popular
Source: National Statistics Office of Georgia, 2021 [55].
in many countries, the attitude towards it in Georgia is quite negative. The majority of students
blindly choose higher education without analyzing the situation and the expected results, and
Weinthink
manythat
cases
thewepromotion
come to theof expenses incurred
professional on education,
education will whether
definitely it islead
monetary
us to resources
the desired results,
or students’
both from labor
the point of and
viewtime, which
of the is wasted,
economy of we mean the
Georgia andcase
the when thesituation
general expenses inincurred on
the country. There
education
is simply a needexceed the benefits
for more received.from the state and, accordingly, more properly conducted
involvement
measures, raising the level of awareness in society and creating all the prerequisites in order to change
the attitude towards vocational schools as positively as possible. All this will eventually become a
4. Conclusions
contributing factor for improving the level of education or the economic situation [56].
In As
general,
can be we
seenbelieve
from thethatabovethe promotion
data of vocational
and their analysis, education,
in the modern labor especially
market thereinis the
a case of
Georgia, willdemand
greater be oneand, ofaccordingly,
the meansanfor reducing
abundance the unemployment
of vacant positions in the level andoffor
direction the effective
service
formation
and sales, as well as individual services. And the number of graduates is the largest in suchpopular in
of the labor market. However, despite the fact that professional education is
educationalthe
many countries, programs,
attitudewhich in theit future
towards involveisemployment
in Georgia quite negative.as high-ranking
The majority professionals
of students blindly
chooserather
higherthan starting work
education withoutin the field of trade,
analyzing sales and services
the situation and the (ISCO-08).
expected results, and in many cases
we comeTherefore, it will notincurred
to the expenses be an exaggeration
on education,to saywhether
that there
it is
is amonetary
real imbalance in the or
resources modern
students' labor
national
and time, labor
which is market
wasted, in we
terms of supply
mean and demand
the case when the of human
expenses capital. On the on
incurred other hand, thisexceed the
education
circumstance
benefits received. clearly indicates the weak institutional connection between the education policy
and the labor market, which is an important factor determining the high degree of vertical and
horizontal mismatch between education and employment.
4. Conclusions
As can be seen from the above data and their analysis, in the modern labor market there is a greater
demand and, accordingly, an abundance of vacant
33 positions in the direction of service and sales, as
Summarizing the issues discussed above, we can draw the following conclusion. We have
seen that education plays a very important role for each country, it is important both for the
country’s economy and for the state of the country in general. Based on history and examples
of countries, it can be said that differences in the level of education often explain differences in
income, which once again emphasizes its important role, although not always, since there are
many other important factors that also affect the economy of a country.
The analysis of the influence of higher education on employment and income in Georgia
demonstrates that the investment in higher education yields a discernible return at this point,
but the human capital, which is created in the higher education system, is still not effectively
used in the country. As a result, in addition to increasing state investment in higher education,
it is critical to implement other measures to raise the rate of public return on higher education.
Possible approaches in this direction include:
• Rationalization of state expenditures on higher education based on empirical data;
• Increasing the compatibility of higher education system outcomes with market require-
ments;
• Increasing overall income from higher education;
• Increasing access to higher education for vulnerable groups;
• Providing relevant statistics for distribution of employment and unemployment levels
according to qualifications;
• Further encouragement of cooperation between the private sector and vocational schools
to increase the existing scale of transition to work-based learning. Also, increasing the
involvement of the private sector in the process of developing vocational education
training programs to ensure compliance of vocational education programs with labor
market requirements.
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