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Study: Impact of literacy on earnings for native-born Canadians
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A new study, published today in the International Adult Literacy Survey monograph series, examines the distribution of literacy skills in Canada, how these skills are generated, and the impacts of literacy on labour market earnings.
The study focused mainly on data from the Canadian component of the 2003 International Adult Literacy and Skills Survey, composed of a sample of over 22,000 respondents. The Canadian component of the 1994 International Adult Literacy Survey was also used to obtain a more complete picture of how literacy changes with age and across birth cohorts.
The study found that literacy is primarily determined by schooling. It also found that literacy tends to decline with age after individuals leave formal schooling, and that schooling itself is the prime driver of literacy.
In addition, the study showed that the direct impact of literacy skills on earnings is substantial. According to its estimates, a 25-point increase in the average literacy score has an impact on earnings equivalent to an extra year of schooling.
Estimates also suggest that about one-fifth of the substantial impact of schooling on earnings arises because schooling generates higher levels of literacy.
In large part, the generation of literacy skills has to do with formal schooling and parental inputs into their children's education. Also investigated was the nature of literacy generation in the years after individuals have left formal schooling and are in the labour market.
The study explored both the causal impact of literacy on earnings and the joint distribution of literacy and income. It argues that the latter provides a more complete measure of how well an individual is able to function in society.
Definitions, data sources and methods: survey number 4406.
The report, "Literacy and the Labour Market: The Generation of Literacy and Its Impact on Earnings for Native Born Canadians," part of the International Adult Literacy Survey Series, No. 18 (89-552-MWE2007018, free), is now available from the Publications module of our website.
For more information, or to enquire about the concepts, methods or data quality of this release, contact Client Services (toll-free 1-800-307-3382; 613-951-7608; fax: 613-951-4441; educationstats@statcan.gc.ca), Culture, Tourism and the Centre for Education Statistics.
