Skills‐based Full Employment: the Latest Philosopher's Stone

The acquisition of knowledge and skills is increasingly seen as both the main challenge and the central opportunity for achieving a return to full employment. It is considered a challenge because it is feared that people without appropriate knowledge and skills will in future be unable to find work. There are two main reasons for this. First, most though by no means all the jobs that have been destroyed through technological progress in recent years have been low-skilled ones, and the educational levels demanded for most occupations seem to be rising; in nearly all societies unemployment is highest among those with low levels of education (OECD, 1994: ch 6). Second, it is generally assumed in the existing advanced countries that the challenges posed by the rise of new low-cost producers in other parts of the world can be met only if labour in the former countries has high levels of skill which will differentiate it from the capacities of workers in the newly industrialising countries.