India is often described as a future workforce superpower. By 2030, it will have the world’s largest working-age population. But demography alone does not create productivity. Skills do.
But India’s workforce challenge lies in a less visible but decisive constraint: foundational literacy and numeracy (FLN). These basic capabilities of reading with comprehension and working with numbers are not early learning milestones to be “completed” by age ten. They are the load-bearing foundations of every advanced skill, from digital fluency and vocational training to adaptability in a fast-changing labour market.
Global evidence increasingly shows that without strong FLN, investments in skilling, digital transformation and future-of-work initiatives deliver diminishing returns. For India, where learning deficits emerge early and compound over time, FLN may be the single highest-return investment for long-term economic growth.
The Learning Crisis Beneath the Skills Conversation
India’s learning challenge is well documented. The 2023 ASER report found that only about 43% of children in Class 5 could read a Class 2-level text and basic arithmetic proficiency remains similarly low. These gaps do not disappear with age; they harden.
International research confirms this pattern. The World Bank’s State of Global Learning Poverty estimates that 70% of children in low- and middle-income countries cannot read a simple text by age 10, with long-term consequences for productivity and earnings.
From a workforce perspective, this matters because skills build cumulatively. Cognitive science shows that higher-order skills like problem-solving, digital literacy and technical training depend on early mastery of reading and numeracy.
In other words, a weak FLN base constrains the effectiveness of every subsequent investment in human capital.
FLN as an Economic Multiplier
Education economists increasingly frame FLN as a macro-critical variable.
A landmark study by Hanushek and Woessmann shows that improvements in basic cognitive skills are strongly correlated with long-run GDP growth — more so than years of schooling alone.
More recent modelling in The Lancet estimates that closing foundational learning gaps could generate trillions in lifetime earnings globally, with especially large gains in countries with young populations.
For India, this implies that FLN is both a social investment and a growth capital. Every cohort that enters the labour force without basic literacy and numeracy represents lost productivity, lower adaptability and higher vulnerability to automation.
The Workforce Consequences of Weak Foundations
The future of work is often framed around AI, automation and digital skills. But evidence from labour economics suggests that workers with weak foundational skills are the most exposed to technological displacement.
OECD research shows that adults with low literacy and numeracy are significantly less likely to benefit from digital upskilling programmes and more likely to be trapped in low-wage, informal employment.
In India’s context, where over 80% of employment remains informal, weak FLN limits mobility even within low-skill sectors. Workers struggle with written instructions, basic financial calculations, safety protocols and digital interfaces increasingly embedded in logistics, manufacturing and services.
This is why skilling initiatives that bypass FLN often underperform. Training cannot substitute for foundations it assumes already exist.
Why Early Intervention Delivers the Highest Returns
Neuroscience and developmental economics converge on a clear insight: returns to learning investments are highest in early childhood and primary school.
James Heckman’s work on skill formation demonstrates that early cognitive skills make later learning more efficient; remediation becomes costlier and less effective over time.
In India, delays in foundational learning often stem from first-generation schooling, language barriers, malnutrition and inconsistent early schooling. These challenges disproportionately affect children from low-income and migrant families — precisely those who will form the bulk of the future workforce.
Targeting FLN early is therefore not only equitable, but economically rational.
FLN and the Digital Economy: A Hidden Dependency
India’s digital public infrastructure — from payments to health records — is often cited as a global model. But digital inclusion depends on the ability to read, interpret and act on information.
Studies on digital adoption show that literacy is a stronger predictor of effective technology use than device access alone.
Without FLN, digital tools risk widening inequality rather than reducing it. Workers may be connected but not empowered; enrolled but not capable of navigating systems independently.
Seen this way, FLN is a prerequisite for inclusive digital growth.
Why Delivery Matters
India has recognised the centrality of FLN through policy initiatives such as the National Education Policy (NEP) 2020 and the NIPUN Bharat Mission. The challenge now lies in execution — particularly in communities where schools face teacher shortages, high student mobility and limited parental support.
Global evidence suggests that community-embedded models combining classroom instruction with parental engagement, remediation and contextual learning are most effective in accelerating foundational skills.
This is where civil society plays a critical role as an implementation partner.
Bridging the Last Mile: Community-Led FLN in Practice
Organisations like Smile Foundation operate at the intersection of education, nutrition and social context where foundational learning outcomes are actually shaped.
Through school-based programmes, remedial learning, teacher support and parental engagement in underserved communities, Smile Foundation’s education initiatives address the non-academic barriers that undermine FLN: poor nutrition, irregular attendance, language gaps and lack of learning support at home.
This integrated approach reflects findings from implementation research showing that learning outcomes improve when education interventions are paired with health, nutrition and family engagement.
By stabilising learning environments and supporting early mastery, such models increase the likelihood that children transition into secondary education with the skills needed to benefit from further training.
FLN as a National Workforce Strategy
Countries that succeed in the future economy will be those that ensure:
- early mastery of literacy and numeracy
- smooth transitions from school to skill development
- continuous learning across the life course
India’s scale magnifies both risk and opportunity. Small improvements in foundational learning, applied across millions of children, generate outsized economic returns.
Investing Where the Compounding Begins
The most powerful investments are those that compound over time. Foundational literacy and numeracy do exactly that persistently, and across generations.
If India’s ambition is to build a resilient, adaptable and productive workforce, the starting point is not the factory floor or the coding bootcamp. It is the primary classroom, the community learning centre and the child learning to read with confidence and count with understanding.
That is where the future workforce is already being shaped.
