It is a truth universally acknowledged, that an economy in possession of common sense, must be in want of high literacy rates.
To risk misquoting Jane Austen, this statement perfectly encapsulates a fundamental truth that applies to every economy, regardless of what stage of development it is at.
Dangers of Poor Adult Literacy
There are only a few things in life that are truly indisputable. Theodore was the cutest Chipmunk, for example. Death and taxes are certainties. And there is no such thing as having read ‘too many’ books.
‘Children who read for pleasure do better across the whole curriculum,’ says Give a Book’s Alison Palmer. ‘It offers the chance to build empathy, to discover the wider world, escape into new worlds and learn new things.’
The benefits of maintaining adequate literacy rates are endless, not just for children, but for the economy as a whole. Unfortunately, our country seems to have forgotten this. An abysmal number of five-year-olds are falling behind their expected reading levels and 18 per cent of England’s adult population (around 8.5 million people) can be described as having ‘very poor literacy skills.’ Without intervention, near-illiterate children will become near-illiterate adults. But how is this going to impact us all in the future?
Rising Unemployment
‘Low reading levels in childhood can severely impact adulthood, limiting career opportunities, lowering earnings, and increasing the risk of unemployment,’ says Katie Bareham, CEO of Doorstep Library, a charity delivering books directly into the homes of children across London.
Adults with poor literacy skills can earn up to 60 per cent less and are twice as likely to be unemployed than their better-read counterparts. There are a host of reasons why this is the case: they are more likely to fail crucial GCSEs such as English, which is a must-have qualification for many jobs or higher education schemes, and, while job-hunting, they will struggle to communicate their achievements in a CV or fill out application forms. After all, companies are quick to judge candidates based on their spelling and grammar and reject those who they deem to be ‘careless or unqualified.’ Repeated job rejections mean near-illiterate individuals can spend prolonged periods unemployed, during which they will not be paying income tax and might be claiming benefits such as the Jobseeker’s Allowance (JSA) or Universal Credit.
For the government, this spells disaster. According to a new landmark study by Pro Bono Economics, poor literacy is costing our economy £830 million for every year group of five-year-olds starting school, with the government losing between £50 million – £270 million in increased welfare spending, due to higher numbers of benefit claimants, and £220 million in lower tax take, as a result of lower earnings. So, just like ordinary households who find themselves simultaneously spending more and earning less, the government will take on debt to plug the spending gap.
Widening Budget Deficit
When the state spends more than it earns from tax revenue, it will need to borrow the difference. This is referred to as the budget deficit. In the UK, the budget deficit in the financial year to January 2025 was £64.8 billion, almost £4 million higher than it was in the same period a year earlier. To clarify, it is not unusual for governments to borrow huge sums of money. Since the ’70s, our average annual budget deficit has been 3.7 per cent of GDP. However, certain conditions make taking on that debt more (or less) favourable.
The budget deficit is financed by selling government bonds, which is essentially an ‘IOU’ note from the state, promising investors that over X years, the government will return all the money they were lent, plus Y in interest. The interest paid on bonds, which fluctuates according to inflation and interest rates set by the Bank of England, is an enormous cost for the government. In 2023/24, it was equivalent to 3.9 per cent of GDP. With inflation having risen since last month and the Bank rate currently standing at 4.5 per cent, the signs are not promising. As we have seen previously, poorer literacy rates widen the budget deficit, which means the state taking on debt at a time when it has become more costly to do so.
To fund its spending on debt interest, the government has one of three options: continue borrowing, cut costs by reducing the quality of public services and scaling back future growth projects, or increase its earnings by raising taxes. All options will have dire consequences for the average Brit.
Poor Health
Not all adults who struggle to read and write will be unemployed, or claim benefits. But, as Robert Glick, chair of Adult Literacy Trust, explains, these individuals will not ‘possess the basic skills required to participate fully in the workforce.’ Not only do employees with poor literacy struggle to complete common tasks, like responding to emails and updating records, but evidence shows there is a direct correlation between low literacy levels and adverse health outcomes.
‘Poor literacy affects confidence, making daily tasks like … understanding medical instructions difficult,’ adds Katie Bareham. ‘It can lead to social isolation, poor health outcomes, and difficulty supporting their own children’s education, perpetuating a cycle of low literacy.’
For example, near-illiterate individuals were found to have higher hospital admission rates and an inability to comprehend medical advice. Employees with poor literacy, therefore, can be expected to spend more time off work sick than colleagues with adequate literacy skills, further reducing their productivity. And, as Bareham points out, illiteracy is a generational issue. Children are more likely to become poorly literate if their parents are too, which reduces their chances of economic success before they have even entered the workforce.
England’s adult literacy crisis is like a decaying tooth; we try desperately to ignore it, but the ache will never go away by itself. Without significant intervention from the government, both to aid poorly literate adults now and to prevent future generations of children from having the same fate, the situation will only worsen.
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