It's no secret that low productivity is a major issue for the New Zealand economy. There are many factors contributing to that.

One, which may sometimes be overlooked, is declining literacy. Research published by the Tertiary Education Commission in 2014 examined the literacy of a cohort of young people commencing non-university tertiary education.

More than half had literacy skills below those that are considered necessary to operate in an information-rich society.

The research also revealed that the current NCEA literacy requirement is a very poor indicator of those skills. Other, recent research from the OECD suggests that long-run productivity is substantially improved by increases in a human capital measure of which literacy is a substantial component.

Countries with better literacy tend to have higher economic growth and lower rates of incarceration.

While correlations alone can't prove a causal link, it's hardly drawing a long bow to suggest that a highly literate population will be more productive than a less literate one, and its members less likely to engage in criminal behaviour.

To its credit, in the wake of the TEC report, the Ministry of Education recognised that a literacy requirement that does not reliably certify literacy is a bad look for NCEA. As part of a review of the qualification in 2018, they announced an intention to implement a new, more robust, requirement. It will be superior to the previous requirement in two ways. It will be measured in a more reliable way, and it's pitched at a level that will require students to be functionally literate to attain it.

The new literacy requirement is currently being piloted in a sample of schools. However, responding to concerns from the education sector that many students will struggle to attain the new requirements, the Government has recently announced that meeting the requirement will not become a mandatory corequisite for NCEA until 2024, a year later than originally planned.

In the short-to-medium term, the new requirement does present a dilemma. For far too long, New Zealand has favoured ineffective means of teaching literacy at primary level. As a result, many young people coming through the education system will struggle with the new NCEA requirements.

We have badly let down far too many young people when it comes to literacy education. The Ministry of Education must do all it can to ensure that these students are not disadvantaged in the pursuit of NCEA qualifications. In practical terms that means resourcing structured literacy programmes at intermediate and secondary schools.

More fundamentally, there's an urgent need to reform literacy teaching at primary schools, so that future cohorts are not similarly disadvantaged. There are already moves afoot in that regard. Earlier this year, the Ministry released a strategy signalling a more structured approach to literacy in primary schools.

While the strategy was short on detail, it's a step in the right direction. Still, it's easy to announce a new strategy. It's the follow-through that will count. There will be resistance to structured literacy. After decades of a constructivist, "whole language" orientation to literacy education, changing course will be difficult. That's one of the reasons that the new NCEA requirement is so important. Apart from doing the job it's designed to do – certifying a level of literacy sufficient to deal with demands of everyday life and employment – it will put pressure on the Ministry of Education to hold the line on promoting more effective methods of teaching younger children to read and write.

It's understandable that schools are complaining about the new NCEA requirements. No one wants to see young people failing, especially through no fault of their own. The delay until 2024 will give the education system more time to prepare, but it must not become indefinite. It would be all too easy for the Ministry of Education to give in to the pressure, and either water down or simply cancel the new requirements.

Business leaders have a role to play in ensuring this doesn't happen. They know the importance of a literate workforce, especially in these times of acute skills shortage. They must therefore be vocal in support of both the literacy requirements for NCEA and evidence-based approaches to early literacy teaching.

When the new requirements become mandatory, having any level of NCEA will, for the first time, be a reliable indicator that a young prospective employee has attained at least basic adult literacy. Perhaps even more importantly, the new requirements will make it politically impossible to persist any longer with ineffective methods of teaching literacy to younger children.

Improving literacy ought to be a no-brainer. It will benefit individuals, business and the country alike. We know how to do it – scientific evidence strongly supports a structured literacy approach. It would be a tragedy if urgently needed change was to be stymied by proponents of a failed educational ideology.