The Importance of Functional Literacy: Reading and Math Skills and Labour Market Outcomes of High School Drop-outs

Ross Finnie and Ronald Meng

Analytical Studies Branch Research Paper Series from Statistics Canada, Analytical Studies Branch

Abstract:

This study assesses the effects of literacy and numeracy skills on the labour market outcomes of Canadian high school drop-outs. We find that these skills have significant effects on the probability of being employed and on hours and weeks of work for both men and women, and also have strong (direct) influences on men's, but not women's, incomes. These findings imply that high school curricula that develop literacy and numeracy skills could provide significant returns even for those who do not complete their programs and wind up at the lower end of the labour market. Our findings similarly suggest that training programs catering to drop-outs could substantially improve these individuals' labour market outcomes by developing these basic skills. The results also have implications for dual labour market theory, since it is often assumed that the secondary market is characterized by minimal returns to human capital'contrary to what is found here.

Keywords: Education; training and learning; Employment and unemployment; Household; family and personal income; Income; pensions; spending and wealth; Job training and educational attainment; Labour; Literacy; Outcomes of education (search for similar items in EconPapers)
Date: 2006-03-27
New Economics Papers: this item is included in nep-edu, nep-hrm and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:stc:stcp3e:2006275e

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