Productivity and Building Human Capital for the ‘Bottom Third’

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Abstract

This article argues that the most effective way to boost productivity while creating a more equitable labour market is to focus on the human capital needs of the bottom third of the workforce — low-paid, low-skilled workers largely employed in consumer services. The author reviews the evidence that raising average literacy and numeracy levels has a stronger productivity impact than raising the proportion of high-skill workers, and proposes a scheme for paid training leave funded through Employment Insurance to address the unmet demand for adult learning.

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