Lifting literacy and numeracy in workplace delivers productivity

"The OECD has estimated that a 1 per cent increase in a population's literacy skills will lead to a 2.5% increase in labour productivity and a 1.5% increase in per capita GDP.

Considering that ABS data [1] has found that almost half of working Australians have less than the minimum literacy and numeracy levels required to meet the demands of everyday work, there is a huge potential to lift productivity.

"Ai Group has this month launched a national project – with the support of the Commonwealth Department of Education, Employment and Workplace Relations – to examine the impact on businesses of low literacy and numeracy and to road-test solutions.

"In our discussions with Ai Group members, they see a number of areas where low literacy and numeracy has a negative impact including industry productivity, OHS, skilling and career advancement. Members report that:

- Productivity is a significant issue particularly where employees can't read standard operating procedures. This can result in machinery being used inefficiently, products needing to be reworked and high wastage rates.
- Safety is a major issue with low literacy resulting in avoidable injuries and accidents because employees don't fully understand warning signs, written instructions and other guidance.
- It is also very difficult to up-skill existing workers if they don't have the literacy skills to read training materials. This impacts on both individual career advancement and a company's ability to introduce new equipment and new processes.

"It's important to get the 'basics right' at the school level and to ensure school leavers are job ready. Additionally, the solutions that we identify in our national project will provide a model for addressing existing endemic literacy and numeracy problems in many workplaces," Ridout said.