Good literacy and numeracy skills will help everyone prepare for the rapidly evolving needs of the modern workplace. These information processing skills are essential to allow workers to perform their jobs, to help them acquire job-specific skills, and to improve their earnings and employment opportunities.

However, international surveys of adults’ levels of literacy and numeracy skills show that Canada’s working-age population has experienced a decline in these skills, even though more Canadians have obtained a post-secondary education over time (see table 1). Some groups, such as immigrants and Indigenous people, have lower average literacy and numeracy skills than the overall population. (In this article, “skills” refers to literacy and numeracy skills unless specified otherwise.)

People born in Canada

Comparing results of the surveys conducted by the OECD in 2003 and 2012, my C.D Howe Institute study shows that both aging and generational differences contribute to the literacy and numeracy skills declines among the Canadian-born population. People get lower test scores as they get older; generational differences are the variations in results among groups of individuals of the same age (e.g., those aged 25 to 34) as measured at different points in time.

The rate of erosion of skills accelerates with age, so with an increase in the proportion of older people in Canada’s population, the average performance has gone down. Age-related skills decline may be caused by people not continuing education or training or not applying existing skills frequently enough. This highlights the importance of obtaining the highest possible skills as early as possible, since skills start declining once people leave school.

In these surveys, recent generations of Canadians had lower scores in literacy and numeracy in 2012 than in 2003, regardless of education level. Although skills declined for all education levels, the drops were substantially larger among those without a university degree. Differing education quality and lower admission requirements for post-secondary education are potential explanations for the lower skills levels of equally educated adults over generations. In addition, the aging effect and generational differences are more profound among low achievers and less educated individuals.


Immigrants come to Canada with various job-specific skills. High literacy skills make immigrants able to use their full skill sets and accelerate their labour market integration. However, there is a large gap in literacy skills between immigrants and non-immigrants, even though a greater proportion of immigrants have post-secondary education.

In a C.D. Howe Institute study on immigrants, I show that language background is a major factor that affects skills gaps between immigrants and non-immigrants. Literacy tests are administered in the official language(s) of the host country. Immigrants to Canada without English or French as a mother tongue would naturally be expected to have lower scores on literacy exams than those who have a greater background in any of these languages.

Another important factor that affects the skills gap between immigrants and non-immigrants is education. Higher levels of education translate into greater skills for both immigrants and non-immigrants, but literacy levels for immigrants across all levels of education, including university-educated immigrants, are persistently lower than those of non-immigrants. However, immigrants who obtained their highest level of education in Canada performed better on literacy tests than those who received degrees in all other countries, regardless of their language background.

There are also notable variations in the literacy gap between immigrants and non-immigrants by immigration program. The literacy gap is much wider for refugees and family-class immigrants, where language and education are not selection factors for immigration.

Indigenous people

The poor performance of Indigenous people relative to non-Indigenous Canadians in literacy and numeracy tests (table 1) is not surprising, since according to the 2012 survey only 10 percent of Indigenous people in Canada hold a university degree, compared with 22 percent of non-Indigenous Canadians. Among Indigenous groups, Inuit have the worst performance; only 4 percent of Inuit have a university education.

Skills gaps between off-reserve Indigenous people and non-Indigenous Canadians are wide among those without a high school education. Although the gap in literacy scores between the Indigenous and non-Indigenous populations shrinks with more education, both First Nations and Inuit people experience large skills gaps at every education level.

In work I did with Colin Busby, we showed that differences in education levels and the characteristics of the home environment are able to explain the largest share of the Indigenous skills gap. This is particularly true for Métis.

Since education and training are central to improving skills outcomes for all population groups, they require special policy attention. However, training needs to be tailored to the particular needs of each targeted population.

Ensuring people complete each level of their education with the highest possible skills level, by focusing on education quality, is the best strategy to limit age-related skills decline. Other potential policies include encouraging active learning and offering adult training opportunities for those at higher risk of skills depreciation. Policy-makers also need to review their targeted on-the-job training programs to ensure their effectiveness in slowing the skills decline as people age.

To reduce skills gaps for immigrants, in addition to education, the focus should be on language ability and post-immigration language training, especially for newcomers.

For Indigenous people, attention should be given to improving skills development during primary and secondary education. To do this, more data should be collected. Well-designed training opportunities should also be provided for both unemployed and employed Indigenous people since they experience a greater unemployment rate.

These policy improvements will help develop a more skilled workforce and would drive broader prosperity and economic growth with positive social impacts.

This article is part of the Preparing Citizens for the Future of Work special feature.

Photo: Shutterstock, by TZIDO SUN.

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Parisa Mahboubi
Parisa Mahboubi is a senior policy analyst and leads the C.D. Howe Institute’s Human Capital Policy Council. Her research interest focuses on social policy with a concentration on demographic, skills, education and labour market concerns.

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