Brain Drain

Preface

In today’s world, human capital, understood as the collective knowledge, skills, and

experience of a country’s population, has become the most valuable resource and a

strategic asset that confers relative advantage for transitional democracies and developing

economies. Georgia, which seeks integration into the Euro-Atlantic space, faces a

significant challenge: pervasive adverse selection and the exodus of talented, highly

qualified, motivated, industrious, and educated people.

Mitigating, reversing, and compensating for the harmful effects of brain drain, in other

words, managing human capital effectively, is not merely a demographic, social, or

humanitarian dilemma. With spillover effects, brain drain produces direct and tangible

economic consequences. The latter weakens the labor market, reduces innovation,

engineering, and industrial optimization, and hinders the country’s competitiveness in the

global economy. This presented article examines how these negative trends affect Georgia’s

economic development and what steps are needed to retain and expand a vital, productive

workforce.

Labor Market Diagnostics and Socioeconomic Outcomes

For years, the Georgian state has increased the share of GDP devoted to education

expenditures. According to recent data, the higher education budget grew by 20 percent in

2024. Yet investments in the education system have largely not been consolidated

domestically as human capital assets and therefore do not translate into commensurate

contributions to the labor market. Exceptionally capable young people who graduate from

universities and vocational colleges, under the pressure of socioeconomic instability and a

shortage of attractive jobs, often fail to identify career prospects, given the limited

professional options, and to secure positions that suit them. Georgia’s labor market still

does not generate a sufficient number of decent jobs, in terms of quantity, pay, and quality,

to absorb in-demand human capital. Low wages, opaque career prospects, the absence of a

meritocratic social elevator, insecure working conditions, and the underdeveloped

professional culture, altogether create multilayered and structurally entrenched barriersthat push young people toward external alternatives and therefore migration.

As Georgia drains from professionals and top specialists, particularly in strategic sectors

such as technology, logistics, healthcare, engineering, and education, other countries

benefit from the human capital into which Georgian society and the state have continuously

poured time and material resources. On the one hand, there is an oversupply of law and

social-science graduates; by contrast, there is an acute shortage in technical and scientific

fields, especially STEM. Consequently, much of the country’s creative, effective, and

productive workforce either falls into the NEET group or is forced, beyond its

specialization, to choose unstable and low-paid sectors (e.g, services) as the only source of

employment. According to Geostat and international financial institutions, youth

unemployment in Georgia is among the highest in the region. Added to this is segmented

labor market concentration, with more than 40 percent of positions tied to the informal and

primary sectors of the economy, where social guarantees and diverse opportunities for

professional advancement are virtually absent.

In a globalized and hyper-specialized economy, human talent and creative potential

constitute Georgia’s principal advantage. Given the country’s internal socioeconomic

realities, the mass outflow of what is practically the sole critical resource exponentially

slows down entrepreneurship, scientific research, and technological progress. Many

Georgians are compelled to seek employment abroad because local companies cannot offer

competitive remuneration and the conditions necessary for career development. From a

fiscal perspective, emigration and brain drain partly mask a cascade of pervasive and acute

socioeconomic problems. Remittance inflows account for a significant share of Georgia’s

GDP. Yet, this cannot serve as a sustainable, future-oriented development model. Such

monetary transfers are directed mainly toward consumption rather than foreign direct

investment, which means they do not create new jobs, inclusive capital, or productive,

wealth-generating sectors in the country.A Strategic Policy Agenda for Retention and Renewal

Modernize the labor market

Improve labor legislation and adapt it to Georgia’s specific dynamics to ensure workplace

stability and support professional growth. Particular attention should be paid to

decentralized regional policy so that young people seek prospects and opportunities beyond

the capital city.

Targeted educational policy aligning with demand

Education policy must be targeted and synchronized with labor market needs. Priority

should be given to developing technical and vocational education and training, also known

as TVET, and to strengthening STEM fields. An integrated database on labor market demand

and educational dynamics would support policy design and effective cooperation across

industries.

Catalyze innovation and entrepreneurship

Cooperation between the state and the private sector should center on developing

innovation and stimulating high-tech industries. Supporting the startup ecosystem,

expanding technological infrastructure and modern research centers, and ensuring fair and

equal access to resources and capital will help bring back and retain a high-quality, highly

skilled workforce.

Design reintegration pathways

For qualified professionals active in the competitive labor markets of developed economies,

inclusive policies and adaptive leverages are needed that encourage their return to Georgia

and facilitate integration into suitable roles.

Ensure political stability and institutional quality

Political stability and the effective functioning of democratic institutions are prerequisitesfor long-term economic and social progress. A robust state foundation and institutional

framework create a predictable and secure environment for investment, strengthen interest

in the labor market and economy, and provide optimal conditions for initiatives to develop

human capital.

Preconditions for a Georgian Leap

Preserving and developing human capital serves as the bedrock of economic resilience in

the twenty-first century. As a small, open, developing economy, Georgia cannot prevail in

global competition through military power or the exploitation of natural resources. The

country’s long-term success and any breakthrough in its development trajectory depend on

how effectively it can employ, retrain, educate, and professionally assist its people,

especially young generations, to retain human capital in the country.

If the Georgian state and society fail to articulate a consistent strategic vision and a

calculated action plan grounded in an informed agenda, patterns of brain drain will continue

in geometric progression, and soon or later, Georgia might experience an even severe

deficit of difference-maker professionals and a competitive labor force. Now more than

ever, Georgia needs forward-looking and constructive consensus on how to transform into

a place where it is worth staying, living, and working, not because of empty guarantees or

flag-waving, but because of attractive economic prospects and pragmatic professional interests.