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ISET Economist Blog

A blog about economics in the South Caucasus.

The Roots of Education are Bitter... is its Fruit all that Sweet?

In his famous “Advice to Scholars”, David Guramishvili wrote (translation by Venera Urushadze):

If you seek happiness and good,
First taste the bitterness of gall,
For bitter roots yield sweetest fruits,
And honest labour blesses all.

Guramishvili is a passionate advocate of learning not as a means of getting a better job or achieving any other pragmatic objective. For him, the fruit of education is sweet because “wisdom to the wise brings calm and makes him master of his lot”. Learning is thus seen a goal in and of itself.

Judging by today’s realities, we may think that Guramishvili’s lofty ideal of learning for its own sake is shared by a large share of young Georgians. Indeed, many Georgians are pursuing higher education only to find themselves unemployed or employed in lowly occupations that do not require any education.

Even more surprisingly, as the ISET Policy Institute team found out while interviewing businesses in Rustavi, Gori, Kutaisi and Batumi, Georgian employers do not necessarily consider education to be a major criterion in their hiring decisions. Many of the interviewees were mostly concerned about the work ethics of their future employees. Others, particularly owners of small family businesses, cared to hire their relatives, whether they had the necessary education (and qualifications) or not.

On the other hand, employers for whom professional qualifications did matter complained that formal education means little and most diploma holders are neither qualified nor sufficiently motivated to learn on the job and perform. So, what is wrong with us? Why is education no longer performing the “signaling” function in the labor market? If education does not help one to get a good job, why the hell we need our diplomas?

The relatively small number of employers the ISET Policy Institute team interviewed are not necessarily representative of the Georgian economy at large. Thus, we decided to have a look at household survey data about education and employment that is available from GeoStat.

As we quickly found out, Guramishvili’s ideal of learning for the sake of achieving wisdom is not as widespread as expected. Only 28% of Georgia’s adult population have university degrees, which is similar to many developed countries such as US or UK. For example, only 27% of 16-74 population in the UK had at least a BA (see Most people in the UK do not go to university – and maybe never will” in The Guardian). About 28% of over-25 population in the US had at least a bachelor’s degree in 2009 (“Educational Attainment in the United States” by Camille Ryan and Julie Siebens, 2012).

Of course, wisdom (or, rather, university diplomas) is more actively sought by younger Georgians. In certain age cohorts of the 20-30 age group, according to GeoStat, university enrolment reaches 46%. Yet, what is truly puzzling is that BA degree holders are less employable, on average, than the Georgian population at large (left panel). Roughly speaking, only two out of four (!) individuals holding a bachelor’s degree are employed as compared to three out of four vocational program graduates.

 

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Does that mean that vocational education can serve as a panacea for Georgia’s unemployment challenges?!

Not so fast.

If we look at the right panel, we will discover that average monthly salaries from primary full-time employment are correlated with educational attainment. While Georgia may be producing too many university graduates, those of them who do find employment (roughly one half) are able to earn much more than the less educated Georgians (on average). This may explain, at least partially, the lure of higher education. Getting a university degree is not only a matter of prestige, as a common stereotype suggests. Rather, it is somewhat similar to buying a lottery ticket (to life).

One more advantage of having a university degree (any!) is access to a broader choice of occupations. Ironically, “economist” is the most common Georgian “profession”; next on the list are philologists, translators and interpreters; nursing professionals; bookkeepers; and lawyers. Now, while few Georgian “economists” might know the difference between demand and supply, by virtue of having an education they can occupy a wide variety of public and private sector jobs that do not require any special knowledge beyond basic computer literacy and language skills. Conversely, Georgians without a university degree are often locked into “agricultural jobs” (mostly, subsistence farming), which, sadly, account for most of Georgia’s employment, along with small trade and taxi driving, etc.

Looking at the broader picture of education and employment in Georgia, higher education is indeed the main way for younger Georgians to escape from their villages. While the overall employment rate might be higher for people with non-university educational attainment, employment in non-agricultural jobs is highest for holders of university degrees. More than a half of employed Georgians without university degrees end up being agricultural workers, as opposed to less than 20% for university graduates. Thus, the apparent advantage of vocational education for employment prospects disappears after taking into account the nature of employment (see left panel). Education in Georgia is not so much about getting a job, as it is about getting a well-paying job outside the agricultural sector.

To conclude, the fruits of learning are not terribly sweet in Georgia. But neither are the roots of learning particularly bitter. What kind of wisdom or professional success can be imparted by university programs that (often) do not require students to exert a serious effort and … learn. 

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Tuesday, 15 October 2019

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