PISA, known more for its efforts to test literacy, tested the financial literacy of students in 20 countries and economies in 2018. Estonia and Finland came out on top.
Some 117,000 15 year-olds took part in the OECD Programme for International Student Assessment (PISA) test of financial literacy which evaluated the knowledge and skills of teenagers as regards money matters and personal finance. Addressing topics such as dealing with bank accounts, debit cards and understanding interest rates on a loan, this marked the third time that PISA assessed students’ ability to face real-life situations involving financial issues and decisions.
According to the study findings, released in May 2020, financial know-how is in great form especially in the North. Estonia had the highest average score, with Finland as the runner-up. Also Canadian provinces, Poland and Australia had a strong showing.
But why is it relevant that some teens come equipped with better financial smarts than others? – Well, the teens of today are the workforce of tomorrow. The study reveals, for instance, that only one in three students have the skills to interpret and evaluate a bank statement. That means two in three students are rather illiterate, from a financial perspective. Who would you want working for your company in the years to come?
Kaija Laitinen, Senior Advisor, Global Insight at Business Finland, comments that the latest PISA news reaffirm the notion that Finnish teenagers – taught by the best teachers in the world – have genuine 360° talent that lends itself well to money matters.
“Looking at this financial expertise demonstrated by our 15-year-olds, it is clearly something that – combined with great digital and tech skills – bodes well for the future. For international companies thinking about establishing operations in Finland, it is reassuring to know that the local workforce is exceptional.”
The next phase in the global “war for talent” may well involve scouting the younger generations. The PISA report shows that this can, indeed, be a real difference-maker: kids from different countries are really from different planets when it comes to financial issues.
Around one in four students in the 20 countries and economies that took part in the test – and one in seven in the 13 OECD countries and economies – are unable to make even simple decisions on everyday spending.
At the same time, on average across OECD countries and economies, only one in ten students performs at the highest level of financial literacy. According to the PISA report, these students are able to make financial decisions in contexts that will only become relevant to them later in life.
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