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A country’s economic performance relies heavily on the ability of its labour market to adapt quickly to developments and changes in the global economy. Neoclassical theories of economic growth claimed that production was simply a function of capital and labour. New theories maintain that production is also a function of knowledge and ideas. The new theories stress that “knowledge workers” at all levels of an organization can contribute knowledge that enhances productivity (Romer, 1993). Moreover, with the increased importance of the service sector and high-technology industries, and the decline of low-skilled manufacturing jobs, the new knowledge workers require greater skills in literacy. “Literacy” refers broadly here to the ability to read and comprehend written materials, including reports, documents, and mathematical charts and displays; to use that information to solve problems, evaluate circumstances, and make decisions; and to communicate that information orally and in writing. Better educated workers constitute only one of several complementary factors needed to energize an economy (Levin & Kelley, 1994). However, a growing body of research shows a relationship between literacy and economic performance thereby lending support to the new economic theories and the calls for a more literate workforce (The Creative Research Group, 1987; DesLauriers, 1990; Snow, Barnes, Chandler, Goodman, & Hemphill, 1991; Statistics Canada, 1991; Shapiro & Purpel, 1993; OECD & Statistics Canada, 1995).
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