Loading

Resume: Speaking about jobs, Giorgi Vashadze refers to the number of employed people. Since 2016, this number has been declining annually in Georgia. In 2016-2019, the number of employed people decreased by 43,600. Therefore, the claim that jobs (the number of employed people) decreased before the pandemic does correspond to the truth.

Giorgi Volski ignores the negative employment indicators and emphasises creating new jobs. Jobs in the business sector are growing indeed. However, the number of jobs is not equal to the same number of employed individuals. A working-age person may have two or more jobs. This explains the fact that in spite of job growth in the business sector, the number of employed people in the country is decreasing. In addition, Giorgi Volski claims that the creation of new jobs started under the Georgian Dream government which is not true. Business sector jobs were also growing under the previous government (2009-2012).

Analysis

On 7 September 2020, on air on TV Rustavi 2, Deputy Speaker of the Parliament of Georgia, Giorgi Volski, stated: “What is the crisis we are talking about if we do not take into account what is happening in the entire world? Job creation has finally started and business woke up.” In response to this statement, the leader of the Strategy Builder political platform, Giorgi Vashadze, made a following remark: “Giorgi Volski was speaking about job creation. I suppose they live in a different country. There were 45,000 jobs lost before the coronavirus, notwithstanding their promise in 2016 to create 200,000 more jobs.”

Globally, the coronavirus pandemic and related legislative restrictions were followed by a loss of jobs and incomes. Georgia has not been an exception in this regard. According to the data of the National Statistics Office of Georgia, the unemployment rate increased by 0.9 of a percentage point in the second quarter of 2020 as compared to the same period of the previous year and reached 12.3%. The number of the economically active population (the total sum of employed people and those looking for jobs) remains unchanged. The employment rate dropped by 0.5 of a percentage point to 55.9%. As of the second quarter 2020, the share of hired employees in the total employment constitutes 48.6% which is 1.6 percentage points less as compared to the same period of the previous year.

Situation Before the Pandemic

According to the data of the National Statistics Office of Georgia, the number of employed people in 2019 decreased by 4,000 as compared to 2018, stipulated by a drop in the number of hired employees. In this period, the number of hired employees decreased by 10,900 whilst the number of self-employed individuals increased by 7,000. Of note is that most self-employed individuals are agriculture workers whilst they mostly work for free in domestic households. The share of self-employed individuals in the total employment constitutes 49.7%.

Since 2016, the number of employed individuals has been decreasing annually. In 2016-2019 the number of employed people decreased by 43,600 (see Graph 1).

Statistically speaking, Georgia’s unemployment level has been decreasing annually although this is stipulated by a drop in the economically active population (in particular, those who are looking for jobs) instead of job growth. In accordance with the methodology of the National Statistics Office of Georgia, if a person stops looking for a job, he ends up outside of the workforce and is no longer considered as unemployed. These are the so-called “discouraged workers” who are withdrawn from the workforce although they are not employed.

Graph 1: Employment/Unemployment Statistical Figures in 2012-2019

Source: National Statistics Office of Georgia

According to the data of the National Statistics Office of Georgia, jobs in business sectors have been growing annually in 2012-2018. The annual figure for 2019 has not yet been published although in all four quarters of 2019 the number of jobs has increased as compared to the respective quarters of 2018 (see Graph 2).

Graph 2: Number of Jobs in the Business Sector in 2008-2018

Source: National Statistics Office of Georgia

The National Statistics Office of Georgia makes calculations on business sector jobs based on the declared figures submitted by enterprises. The total number of jobs does not mean the same number of employed individuals. A working-age person may have two or more jobs. This is the reason why in spite of job growth in the business sector, the number of employed individuals in the country is actually decreasing. In this statement, Giorgi Volski claims that the creation of new jobs started under the Georgian Dream government which is not true. Business sector jobs were also growing under the previous government (2009-2012).

In 2016, the Georgian Dream promised voters 200,000 new jobs. In 2017-2018, 67,400 new jobs were created in the business sector. The annual figures for 2019-2020 are not yet available. Giving voters a promise about jobs means you promise them employment. Nevertheless, as mentioned previously, the employment rate in Georgia has been declining annually since 2016.