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The value of basic skills in the British labour market

Author

Listed:
  • De Coulon, Augustin
  • Marcenaro-Gutierrez, Oscar
  • Vignoles, Anna

Abstract

In this paper we evaluate the labour market value of basic skills in the UK, focusing on the wage and employment returns to having better literacy and numeracy skills. We draw on literacy and numeracy assessments undertaken by all cohort members of the UK 1970 British Cohort Study. The data used are very rich and allow us to account for potential ability bias, including as they do early childhood assessments of ability. We find that the literacy and numeracy effects on earnings are over and above any general effect on earnings from a person being more cognitively able. We also assess whether the value of basic skills, in terms of wage returns, has increased over time, using a cross cohort analysis based on the 1958 National Child Development Study cohort and the 1970 British Cohort Study. Our results show that literacy and numeracy skills retained their high value in the labour market over the period 1995-2004, despite numerous policy attempts to increase the supply of basic skills during this period.

Suggested Citation

  • De Coulon, Augustin & Marcenaro-Gutierrez, Oscar & Vignoles, Anna, 2007. "The value of basic skills in the British labour market," LSE Research Online Documents on Economics 19398, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:19398
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    File URL: http://eprints.lse.ac.uk/19398/
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Skills; Labour Market; Literacy; Numeracy;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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