A four-phase longitudinal study was undertaken to examine the relationship between literacy education and employment. Phase 1 focused on trends in Canadian legislation and the labor market and student and teacher attitudes toward the legislative changes. In phase 2, an ethnographic approach was used to identify the educational and employment experiences of seven adult literacy students from Manitoba who were selected to represent a mix of ages, genders, literacy levels, family situations, and racial backgrounds. Life histories of the individuals were compiled that focused on the following: life goals, barriers to returning to school, work expectations, personal problems, and available supports. The study's overall conclusion at the end of year 2 was that, although literacy education offers personal, social, and economic benefits to individuals and society as a whole, literacy is not a "quick fix." There are also personal and structural barriers to learning and employment. The seven adults will be tracked further in phase 3, and the research findings and recommendations will be applied in phase 4. (Appended are demographic data about the case study participants and definitions of stage 1, 2, and 3 learners. The document contains 78 references. Addresses and phone numbers of seven Canadian literacy-related organizations conclude the document.) (MN)