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Schooling, Literacy, Numeracy and Labor Market Success

Author

Listed:
  • Chiswick, Barry R.

    (George Washington University)

  • Lee, Yew Liang

    (University of Western Australia)

  • Miller, Paul W.

    (Curtin University)

Abstract

This paper uses data from the 1996 Australian Survey of Aspects of Literacy to examine the effects on labour market outcomes of literacy, numeracy and educational attainment. The survey includes a range of literacy and numeracy variables that are highly inter-correlated. A “general to specific” approach identifies the most relevant literacy and numeracy variables. Including the others adds little explanatory power. Among males and females separately about half of the total effect of education on labour force participation and on unemployment can be attributed to literacy and numeracy (the indirect effect) and about half to the direct effect of education. There is apparently no indirect effect of labour market experience through literacy and numeracy on participation or unemployment. The direct and total effects of experience are the same. The findings suggest that education is a value added process in which skills, including literacy and numeracy, are improved and that these skills enhance labour market outcomes.

Suggested Citation

  • Chiswick, Barry R. & Lee, Yew Liang & Miller, Paul W., 2002. "Schooling, Literacy, Numeracy and Labor Market Success," IZA Discussion Papers 450, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp450
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    References listed on IDEAS

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    Cited by:

    1. Miller, Paul W. & Mulvey, Charles & Martin, Nick, 2004. "A test of the sorting model of education in Australia," Economics of Education Review, Elsevier, vol. 23(5), pages 473-482, October.
    2. Brecht Neyt & Eddy Omey & Dieter Verhaest & Stijn Baert, 2019. "Does Student Work Really Affect Educational Outcomes? A Review Of The Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 33(3), pages 896-921, July.
    3. Niels-Hugo Blunch & Claus C. Pörtner, 2011. "Literacy, Skills, and Welfare: Effects of Participation in Adult Literacy Programs," Economic Development and Cultural Change, University of Chicago Press, vol. 60(1), pages 17-66.
    4. A'Hearn, Brian & Baten, Jörg & Crayen, Dorothee, 2009. "Quantifying Quantitative Literacy: Age Heaping and the History of Human Capital," The Journal of Economic History, Cambridge University Press, vol. 69(3), pages 783-808, September.
    5. Marwa Sahnoun & Chokri Abdennadher, 2022. "Returns to Investment in Education in the OECD Countries: Does Governance Quality Matter?," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(3), pages 1819-1842, September.
    6. Dohmen, Thomas & van Landeghem, Bert, 2019. "Numeracy and Unemployment Duration," IZA Discussion Papers 12531, Institute of Labor Economics (IZA).
    7. Aline Branche-Seigeot, 2013. "La valorisation des compétences de base sur le marché du travail français," Post-Print halshs-00794385, HAL.
    8. Polachek, Solomon W., 2008. "Earnings Over the Life Cycle: The Mincer Earnings Function and Its Applications," Foundations and Trends(R) in Microeconomics, now publishers, vol. 4(3), pages 165-272, April.
    9. Alam, Khorshed & Mamun, Shamsul Arifeen Khan, 2016. "The relationship between labour force status and educational attainment: Evidence from a system of simultaneous equations model," Economic Analysis and Policy, Elsevier, vol. 52(C), pages 55-65.
    10. Kabir Dasgupta & Alexander Plum, 2022. "Skills, Economic Crises and the Labour Market," Working Papers 2022-01, Auckland University of Technology, Department of Economics.
    11. Patrick Laplagne & Maurice Glover & Anthony Shomos, 2007. "Effects of Health and Education on Labour Force Participation," Staff Working Papers 0704, Productivity Commission, Government of Australia.

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    More about this item

    Keywords

    Human capital; literacy; earnings screening; numeracy; schooling; Australia;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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