Phonemic Awareness is the ability to hear, identify, and manipulate the average person sounds which can make up words. In the past few decades, large amounts of research have improved our knowledge of phonemic awareness and its importance in assisting children learn how to read. You can find hundreds of research studies conducted on all aspects of phonemic awareness, and how it affects and benefits reading and spelling abilities of young children. The National Reading Panel of the US have stated that phonemic awareness improves children’s reading and reading comprehension, and that it also helps children to understand to spell. Based on the research and reviews done by the National Reading Panel, they’ve figured teaching phonics and phonemic awareness produces better reading results than whole language programs.
When teaching phonemic awareness, students are taught the smallest units of sound, or phonemes. Throughout the teaching process, children are taught to focus on the phonemes, and learn to control the phonemes in words. Studies have identified phonemic awareness and letter knowledge as the two best school-entry predictors of how well children will learn to read during the initial 2 years of instruction. In overview of phonemic awareness research, the National Reading Panel (NRP) identified 1,962 citations, and the results of these meta-analysis were impressive as stated in the NRP publication:
Overall, the findings indicated that teaching children to manipulate phonemes in words was highly effective under a variety of teaching conditions with a variety of learners across a variety of grade and age levels and that teaching phonemic awareness to children significantly improves their reading more than instruction that lacks any focus on phonemic awareness (PA).
Specifically, the outcome of the experimental studies led the Panel to conclude that PA training was the reason for improvement in students’phonemic awareness, reading, and spelling following training. The findings were replicated repeatedly across multiple experiments and thus provide converging evidence for causal claims. 
As can be clearly seen, teaching children phonemic awareness early on significantly improves their reading and spelling abilities. Furthermore, the NRP research stated that these beneficial effects of phonemic awareness teaching goes well beyond the conclusion of training period. The NRP phonemic awareness research also found that the utmost effective teaching method was to systematically teach children to govern phonemes with letters, and teaching children in small groups.
Phonemic awareness (PA) teaching provides children with an essential foundation of the alphabet system, and a base in reading and spelling. The NRP has stated that PA instructions is an essential instructional component within a complete reading program.
Here are two other studies done on phonemic awareness, and its effects on reading abilities. In a study involving children aged 6 to 7 years of age, researchers unearthed that the few readers at the beginning of grade one exhibited high phonemic awareness scored at the least close to perfect in the vowel substitution task, compared to none in children of the same age group who couldn’t read if they entered school. The research also stated that phonemic awareness differences before instruction predicted the accuracy of alphabetic reading and spelling by the end of grade one independent from IQ. Children with high phonemic awareness at the start of grade one had high reading and spelling achievements by the end of grade one; however, a number of the children with low phonemic awareness had difficulties learning how to read and spell. The study suggested that phonemic awareness could be the critical variable for the progress in understanding how to read. 
Another study viewed phonemic awareness and emergent literacy skills of 42 children by having an average age of 5 years and 7 months. The researchers indicated that relations between phonemic awareness and spelling skills are bidirectional where phonemic awareness improved spelling skills, and spelling influenced the growth in phonemic skills. 
It is clear that with the conclusions created by the National Reading Panel and other research studies on the benefits of phonemic awareness, children should really be taught PA at a young age before entering school. This can help them build a strong foundation for learning how to read and spell.
1. National Institute of Child Health and Human Development. (2000). Report of the National Reading Panel. Teaching children to read: An evidence-based assessment of the scientific research literature on reading and its implications for reading instruction (NIH Publication No. 00-4769). Washington, DC: U.S. Government Printing Office.
2. Cognition. 1991 Sep;40(3):219-49.
The relationship of phonemic awareness to reading acquisition: more consequence than precondition but still important.
Wimmer H, Landerl K, Linortner R, Hummer P.
University of Salzburg, Austria.
3. Exp Child Psychol. 2002 Jun;82(2):93-115.
Emergent literacy skills and training time uniquely predict variability in responses to phonemic awareness training in disadvantaged kindergartners.
Hecht SA, Close L.