One of the reasons that literacy is so important is the economic impact of illiteracy. In the 2010 paper ‘The costs of illiteracy in South Africa‘ , the authors focus on effective monitoring of adult literacy, and note that self-reported values change according to people’s perceptions of what literacy is. However, self-reported literacy is an important predictor of whether or not people are employed. An increase in literacy would result in a higher GDP for South Africa.
“In a cross-country growth model, poor quality schooling emerges as the variable requiring the most urgent policy attention to sustain and improve South Africa’s economic development. Both microeconomic and macroeconomic estimates suggest that with a more typical level of school performance South Africa’s GDP would be 23% to 30% higher than it currently is.”
The paper estimates the level of illiteracy in South Africa and attempts to put a cost to it. It also identifies strategies for data collection and education.
Source: Gustafsson, M., van der Berg, S., Shepherd, D. Burger, C. (2010). The Costs Of Illiteracy In South Africa. Stellenbosch University.
In the UNESCO paper ‘The social and economic impact of illiteracy: analytical model and pilot study’, the authors add economic and social arguments to the ethical and moral case for literacy. The aim is to aid policy and involve new players, such as those involved in finance and economics. The far-reaching effects of illiteracy on the individual and society are explored.
“Illiterate adults face serious employability issues, given their low level of knowledge and expertise. This is attributable to a lack of formal schooling, caused either by an early departure from school to enter the labour market or the loss over time of the ability to read and write.
In addition, illiterate persons have little awareness of their rights and duties, and may thus be inclined to accept precarious, low-quality employment contracts.
The impact of adult illiteracy can be divided into the following categories: health, education, economics and social
integration and cohesion.”
Source: Martinez, R., Fernandez, A. (2010). The Social and Economic Impact of Illiteracy: analytical model and pilot study.
Low levels of literacy and education in general can impede the economic development of a country in the current rapidly-changing, technology-driven world.
Recommended resource: http://www.read.org.za/useful-info/literacy-the-economy/