The Connection Between Decoding and Comprehension
Phonics instruction helps the reader to map sounds into spellings. This ability enables readers to decode words. Decoding words aids in the development of and improvement in word recognition. The more words a reader recognizes, the easier the reading task. Therefore, phonics instruction aids in the development of word recognition by providing children with an important and useful way to figure out unfamiliar words while reading.
When children begin to be able to recognize a large number of words quickly and accurately, reading fluency improves. Reading fluency refers to the ease with which children read. As more and more words become firmly stored in a child's memory he or she gains fluency and automaticity in word recognition. Having many opportunities to decode words in text is critical to learning words by sight. The more times a child encounters a word in text, the more likely he or she is to recognize it by sight and avoid making a reading error.
Reading fluency improves reading comprehension. Since children are no longer struggling with decoding words, they can devote their full attention to making meaning from the text. As the vocabulary and concept demands increase in text, children need to be able to devote more of their attention to making meaning from text, and increasingly less attention to decoding. If children devote too much time to decoding words, their reading will be slow and labored. This will result in comprehension difficulty.
*From "Phonics A to Z"