Improved employee literacy is essential to meet the
challenges of changing markets.
Literacy: “The ability to understand and employ
printed information in daily activities, at home, at
work and in the community — to achieve one’s goals
and to develop one’s knowledge and potential” (Definition
provided by the International Adult Literacy and
We live in a country where we take literacy for granted.
After all, we spend millions on our education system
and pride ourselves in having some of the best universities
in the world.
And yet, 42% of Canadian adults between the ages of
16 and 65 have low literacy skills. What is considered
literacy? Studies focus on three categories:
- Prose literacy: the ability to understand and use
information from texts such as editorials, news
stories, poems, and fiction.
- Document literacy: the ability to locate and use
information from documents such as job applications,
payroll forms, transportation schedules,
maps, tables, and graphs.
- Quantitative literacy: the ability to perform arithmetic
functions such as balancing a chequebook,
calculating a tip, or completing an order form.
Employers may not realize the negative impact that
low literacy skills have on their bottom line. Issues that
accompany low literacy include:
- inability to understand safety rules
- inability to interpret and explain work-related
issues to fellow employees or those they are training,
thereby lowering the standards of excellence
throughout the business
- inability to problem solve with reference to manuals,
government documents, schematics, graphs, etc.
- increased in-house training costs to produce goods
and services and carry out corporate policy
- lost opportunities to promote individuals with
skills but who cannot meet established deadlines,
work within budget, or understand quality assurance
- risk of accidents or errors when individuals cannot
calculate simple maximum weight or height capacities
- lost productivity when employees cannot adapt to
- lost revenue when employees make errors in cost
When the Conference Board of Canada asked the
question “Is Canada’s workforce sufficiently skilled?” in
a June 2014 document, the answer was:
No. Given that Canada is a leader in post-secondary
educational attainment, one might reasonably
expect that the country would also be a leader in
adult skills. Yet Canada and most provinces do
relatively poorly on adult literacy, numeracy and
problem-solving skills, earning mainly “C” and
To improve on these standings, Human Resources and
Social Development Canada has identified nine essential
skills needed to improve workplace literacy:
- document use (understand electronic and paper
- oral communication
- digital technology
- working with others
- continuous learning (ability to increase knowledge
and adapt to change)
The Canadian workplace is experiencing a shortage of
skilled labour as older, experienced persons retire. To
fill the gap, employers are required to hire younger, less
experienced individuals and immigrants.
Technically skilled workers may not be
promoted because they lack literacy skills.
Younger employees may have advanced entry skills in
some of the aforementioned attributes (e.g., continuous
learning and computer use) but lose opportunities for
promotion because they lack skills in communication,
numeracy or writing.
Immigrants certainly have job skills, but the inability
to use either official languages creates a learning problem
in the workplace.
If Canadian businesses want to succeed, management
must examine current operations and imagine what
skills will be needed five to 10 years down the road.
Because changing markets will require highly literate
employees, more time and money will have to be
spent within the organization to increase employee
To make this happen, employers will need to identify
the literacy levels of current employees and then be
prepared to invest more time and money on organizational
training. Such training should not only reinforce
such basic skills as reading, writing and arithmetic, but
also encourage development of the other essential skills
that promising employees may lack.
Such a program will mean that businesses should
seek outside help to assess the literacy needs of all
employees, seek assistance with sourcing appropriate
programs, hire knowledgeable experts, and work up
a budget and schedule training as a necessary part of
the workplace model.
The end result of improving literacy skills will be less
time lost because of accidents, fewer insurance and
workplace safety claims, improved product quality and
greater productivity. Both employees and employers
should reap the rewards and benefits.
The information provided on this page is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without consultation from accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be held liable for any problems that arise from the usage of the information provided on this page.