The Halyk Finance analytical center commented on the data from the National Statistics Bureau (NSB) for the fourth quarter of 2024, which indicates that the unemployment rate in Kazakhstan has reached a historic low, reports inbusiness.kz. According to analysts, the methods used to calculate unemployment levels in the country require a reassessment.
According to NSB data, the unemployment rate in Kazakhstan for the fourth quarter of 2024 was 4.6%, mirroring the trend from the third quarter. This marks a historical low throughout the years of monitoring unemployment in the country. Overall, the unemployment rate decreased by 1 percentage point over the past year. The unemployment rate is assessed using the methodology of the International Labour Organization. According to the definition, an unemployed person is an individual who is actively seeking work and is ready to start working. The unemployment rate is measured as the share of unemployed individuals in the total labor force. Information on unemployment is collected through a sample survey of households.
The unemployment rates for women and men during the reporting period were 5.1% and 4.2%, respectively. In rural areas, the unemployment rate was slightly higher (4.7%) than in urban areas (4.6%). However, women in rural areas were much less likely to be employed, with their unemployment rate at 5.3% compared to 4.2% for men. Possible reasons include a lack of job opportunities and more defined role specifications within families in villages.
The largest share of unemployed individuals (36%) was in the age group of 35-44 years. The youth unemployment rate (ages 15-24) for the fourth quarter of 2024 was 3.3%, significantly lower than the overall figure. However, this data does not include the NEET category (not in Education, Employment, or Training), which reached 356,000 individuals in the country, increasing by 10,000 over the quarter. The long-term unemployment rate (for 12 months or more) for the fourth quarter of 2024 was 0.6%, which is more than twice as low as in 2023 (1.3%). For women, this figure was higher (0.6%) than for men (0.5%).
Fig. 1. Unemployment rate in Kazakhstan and developed countries for the fourth quarter of 2024
Source: NSB, OECD
In terms of regions, the highest unemployment rates were recorded in Mangystau (4.9%), Atyrau (4.8%), and West Kazakhstan (4.8%) regions, which are traditionally characterized by high employment in the oil extraction industry. This may be a consequence of stagnation in the oil sector, where production volume decreased by 2.7% year-on-year to 87.6 million tons. The lowest unemployment rates were observed in Karaganda (4.0%) and Ulytau (4.1%) regions. Among cities of national significance, the highest unemployment rate was recorded in Shymkent (4.8%), followed by Almaty (4.6%) and the capital, Astana (4.4%).
Overall, the current unemployment level in Kazakhstan is quite low. It is significantly lower than in some developed countries. For instance, in OECD countries, the average unemployment rate for the fourth quarter of 2024 was 4.9%, while in certain European countries, it is even higher (Fig. 1). Besides being low, the unemployment rate in the country has remained stable and has been at 5% or lower for the past five years.
"Previously, we wrote about the possible reasons for such a low unemployment rate, which include difficulties with methodology, classification of self-employed individuals, and 'hidden unemployment.' Various studies also indicate that the actual unemployment rate in the country may be higher than the official one. For example, according to a study by the National Bank of Kazakhstan, when including unproductively employed, temporarily employed, and part of the economically inactive but essentially unemployed population, the alternative unemployment rate in Kazakhstan may range from 7.2% to 8.3%.
To address the issue of unemployment in Kazakhstan and assess its true significance, it is necessary to expand the accounting methodology as in developed countries. For instance, the United States and Canada use expanded unemployment indicators (from 6 to 8 indicators) that cover a broader category of the working-age population. Furthermore, new approaches to analyzing the labor market and implementing effective employment programs should be introduced. Such programs must consider existing gender, age, and regional imbalances in addressing unemployment," notes analyst Sanzhar Kaldarov.