"Investing in literacy is investing in people, productivity, and competitiveness, and will ultimately position Canada favourably in the global environment." -Council of Ministers of Education, Canada, 20101
"Canada has an essential skills problem. The need to right this ship is more pressing than ever." -TD Economics, 20132
Only half of Canadians have the essential skills needed to participate in the global knowledge economy.
We think of Canada as a well-educated country, but statistics tell a different story. According to the OECD, Level 3 literacy is the minimum skill required to compete in the global knowledge economy.3
Fully 49% of Canadians fall below Level 3 for literacy and 55% for numeracy.4
What’s more, literacy rates have been declining since the new millennium, and Canadian youth are underperforming compared to other youth in OECD countries.5
When some of us have low literacy, all of us are impacted.
A study of 14 OECD countries over 34 years found that what was most important for economic growth was a country’s average literacy score. When just a portion of the population has very high literacy, it does not contribute as much to the country’s productivity as when skills are improved across the whole labour force.6
Increased literacy saves Canada money.
The World Literacy Foundation estimates that the cost of illiteracy in Canada is $32.31 billion in US dollars.7
Canadians with low literacy are more likely to be unemployed and live under the poverty line.8
Canadians at prose literacy Level 1 are twice as likely to rely on social assistance from the government.9
Low literacy means governments collect less income tax while spending more on social services like the justice system, social assistance, and health services. When kids get support to improve their basic reading skills, it helps keep them in school. High school dropout is costly for Canada. A conservative estimate of cost savings to the country resulting from a one-percentage-point increase in the graduation rate is over $7.7 billion annually.10
Economies grow as literacy improves.
Increasing the proportion of Canadians who achieve Level 3 literacy by just 1% would result in a permanent $18 billion/year increase in our Gross Domestic Product (GDP).11
To compete in the global economy, Canada must reduce its literacy skill gap.
Looking at the supply and demand of literacy skills in Canada shows that "that the economy will have to deal with rising literacy skill shortages over the medium term. These shortages are likely to... dampen productivity growth as employers are forced to hire more workers with weak skills" (Murray and Shillington, 2011).12
"Without solid literacy and numeracy skills, technological literacy is hard to achieve... without such expertise, it is impossible to compete effectively in the global marketplace" (World Literacy Foundation, 2015).13
Literacy is a way out of poverty.
If we want to see more Canadians in the workforce and earning decent wages, essential skills really are that: essential. Improving literacy and numeracy skills has a statistically significant effect on labour market outcomes. Raising literacy levels from 1 to Level 3 significantly improves the chances a person will get a job and increases their wage rate by at least 25%.14
The ELF thanks Juniper Glass (lumiereconsulting.ca) for the creation of this research summary.
- 1 Council of Ministers of Education. 2010. Progress Report on Literacy 2009. Toronto: CMEC. http://www.cmec.ca/Publications/Lists/Publications/Attachments/220/cmec-literacy-progress-report-2009.pdf
- 2 TD Economics. 2013. TD Economics Special Report. Canada’s Literacy and numeracy Challenge Worsens. https://www.td.com/document/PDF/economics/special/CanadaLiteracyAndNumeracyChallengeWorsens.pdf
- 3 OECD and Statistics Canada. 2005. Learning a living: First results of the International Adult Literacy and Life Skills Survey.
- 4 Statistics Canada. 2013. Skills in Canada - First Results from the Programme for the International Assessment of Adult Competencies http://www.statcan.gc.ca/pub/89-555-x/89-555-x2013001-eng.pdf
- 5 Statistics Canada. 2013. Skills in Canada - First Results from the Programme for the International Assessment of Adult Competencies http://www.statcan.gc.ca/pub/89-555-x/89-555-x2013001-eng.pdf
- 6 Coulombe, Serge, Jean-François Tremblay and Sylvie Marchand. 2004. Literacy scores, human capital and growth across 14 OECD countries. Ottawa: Statistics Canada. http://publications.gc.ca/collections/Collection/CS89-552-11E.pdf
- 7 World Literacy Foundation. 2015. The Economic & Social Cost of Illiteracy: A snapshot of illiteracy in a global context. https://worldliteracyfoundation.org/wp-content/uploads/2015/02/WLF-FINAL-ECONOMIC-REPORT.pdf
- 8 Murray, S. & Shillington, R. 2011. From poverty to prosperity: literacy’s impact on Canada’s economic success. Ottawa: Canadian Literacy and Learning Network; OECD, Statistics Canada. 2011. Literacy for Life: Further Results from the Adult Literacy and Life Skills Survey, Second International ALL Report. OCD Publishing; OECD and Statistics Canada. 2005. Learning a Living: First Results of the Adult Literacy and Life Skills Survey.
- 9 Murray, S. & Shillington, R. 2012. Investing in upskilling: gains for individuals, employers and government. Ottawa: Canadian Literacy and Learning Network. www.literacy.ca/content/uploads/2012/09/Investing+Upskilling+full+report.pdf
- 10 Hankivsky, Olena. 2008. Cost Estimates of Dropping out of High School in Canada. Canadian Council on Learning. http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.510.4857&rep=rep1&type=pdfBased on 2008 dollars.
- 11 Coulombe, Serge, Jean-François Tremblay and Sylvie Marchand. 2004. Literacy scores, human capital and growth across 14 OECD countries. Ottawa: Statistics Canada. http://publications.gc.ca/collections/Collection/CS89-552-11E.pdf
- 12 Murray, S. & Shillington, R. 2011. From poverty to prosperity: literacy’s impact on Canada’s economic success. Ottawa: Canadian Literacy and Learning Network, p. 35.
- 13 World Literacy Foundation. 2015. The Economic & Social Cost of Illiteracy: A snapshot of illiteracy in a global context, p. 6.
- 14 Shomos, A. 2010. Links Between Literacy and Numeracy Skills and Labour Market Outcomes. Productivity Commission Staff Working Paper. Melbourne: Productivity Commission. http://www.pc.gov.au/research/supporting/literacy-numeracy-labour-outcomes