‘Economic literacy gap’ must be closed as UK lags behind
The UK is ‘lagging’ behind many other countries in economic literacy, new research suggests.
A report published today, From the bottom up has identified an ‘economic literacy gap’ in the UK.
International research has shown that the UK is lagging behind many neighbouring countries, with less than half (48 per cent) of UK adults admitting they understand how the economy works.
Just over half (56 per cent) admitted they understand how their spending decisions affect their local economy.
The report comes just days before the Budget is due, and according to the report the ‘gap’ must be tackled urgently as it could have “serious implications for the country’s economic recovery”.
Authors of the report state that failure to address the “heavy concentrations of power” in our economy will damage markets further and “hamper” productivity.
Of 2,000 people questioned, 40 per cent said they did not understand business and economics stories covered in the news. 38 per cent admitted that business and economic news stories are not relevant to them.
The international study of economic literacy, published in the Social Economic Alliance, puts Britain behind countries like Germany, Ireland, Finland, Sweden, Denmark, US, Canada and Australia.
According to the Alliance, the UK can “rebalance” its economy through empowering people to make different economic decisions as consumers, citizens and in their communities.
The report states there is a broad consensus that the UK currently has an unhealthy concentration of power across its economy, where power in many markets is distributed in a ‘top-heavy’ way.
With more widespread knowledge and understanding of basic economics, the report says that people can take action and have more control over how things are run in their communities.
Steve Wyler, Chief Executive of Locality and a spokesperson for the Social Economy Alliance, said: “These are exciting times for anyone who cares about consumer power, localism, and citizenship.
“Our economy and our markets are made up of millions and millions of actions taken by people acting alone, but there is so much potential to join them up and unleash people power in the UK.
“The economic literacy gap must be tackled to rebalance our economy and put power in the hands of the people. Economics is everybody’s business”, he concluded.
A third of people (31 per cent) said that they would like to know more about what they can personally do to improve the economy, with younger people aged 18-34 twice as likely (39 per cent) to want to know how they can help as those aged 55+ (22 per cent).
The report recommends that Citizenship studies should include economic as well as financial literacy, along with the suggestion that the annual Budget is moved to Saturday evening for peak-time viewing.
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