The Importance of Functional Literacy: Reading and Math Skills and Labour Market Outcomes of High School Drop-outs
AbstractThis 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.
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Bibliographic InfoPaper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 2006275e.
Date of creation: 27 Mar 2006
Date of revision:
Labour; Education; training and learning; Income; pensions; spending and wealth; Employment and unemployment; Literacy; Job training and educational attainment; Household; family and personal income; Outcomes of education;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-05-06 (All new papers)
- NEP-EDU-2006-05-06 (Education)
- NEP-HRM-2006-05-06 (Human Capital & Human Resource Management)
- NEP-LAB-2006-05-06 (Labour Economics)
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