Schooling, Literacy, Numeracy and Labor Market Success

56 Pages Posted: 31 Mar 2002

See all articles by Barry R. Chiswick

Barry R. Chiswick

University of Illinois at Chicago; IZA Institute of Labor Economics

Yew L. Lee

University of Western Australia

Paul W. Miller

Curtin University of Technology - School of Economics and Finance; IZA Institute of Labor Economics; Curtin University - Centre for Research in Applied Economics

Date Written: March 2002

Abstract

This paper uses data from the 1996 Australian Survey of Aspects of Literacy to examine the effects on labor 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 labor 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 labor 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 labor market outcomes.

Keywords: Human Capital, Schooling, Literacy, Numeracy, Earnings Screening, Australia

JEL Classification: J31, I21

Suggested Citation

Chiswick, Barry R. and Lee, Yew Liang and Miller, Paul W., Schooling, Literacy, Numeracy and Labor Market Success (March 2002). IZA Discussion Paper No. 450. Available at SSRN: https://ssrn.com/abstract=305369

Barry R. Chiswick (Contact Author)

University of Illinois at Chicago ( email )

601 S. Morgan Street, Room 2103UH
Chicago, IL 60607-7121
United States
312-996-2683 (Phone)
312-996-3344 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Yew Liang Lee

University of Western Australia ( email )

35 Stirling Highway
Crawley, Western Australia 6009
AUSTRALIA

Paul W. Miller

Curtin University of Technology - School of Economics and Finance ( email )

GPO Box U1987
Perth WA 6845
Australia

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Curtin University - Centre for Research in Applied Economics ( email )

GPO Box U1987
Perth, Western Australia 6845
Australia

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