The DfES has published the Skills Strategy Progress Report, outlining the work completed to date on developing a comprehensive strategy to identify the skills challenges of the economy and a partnership with business and industry to address them.

Education Secretary Charles Clarke said: "Over the past two decades there has been a consistent recognition of the importance of skills for productivity, growth and sustainable employment. But we have still not cracked the problem of providing effective action to tackle skills needs. Productivity must rise by 15 to 30 per cent to match those of our key competitors; four out of five jobs between now and 2010 will require skills traditionally associated with graduate-level study; employers report intensive challenges in skilled trades; and there is a legacy of adults in the workforce with low skills which we must address if we are to remain competitive.

"Skills are an important element of raising productivity and creating sustainable employment. In June this year we will take a major step forward setting out the action we must take to deliver a Skills Strategy that links skills with the other major drivers of productivity – innovation, enterprise, competitiveness and investment.

"Meeting the skills challenge we face is not an end in itself. It is a means towards the wider goal of enabling our economy to progress and to maintain social cohesion. For individuals, it is about giving them the skills for employability. Employers need to be supported in raising business performance and the quality of products and services they provide through a highly skilled and qualified workforce. And we need to put in place an ambitious, responsive and flexible system to support those needs."

The Skills Strategy is likely to aim for:

- better engagement of employers through more joined up support on business performance and skills; promotion of co-operative arrangements by employers to improve business performance and skill levels; and targeted support from government to employers in return;

- higher quality and more coherent education and training offers to young people on Modern Apprenticeships, and on vocational and occupational courses in further and higher education;

- targeted support for low skilled adults and young adults to engage them in education and training; featuring higher quality advice and learning programmes that meet their needs;

- education and training more influenced by regionally and sectorally determined skill priority areas taking account of employer needs both now and in the future;

- more responsive education and training with more flexible funding of learning to better meet the needs of the learner, greater adaptability in the blocks of learning that can be undertaken and funded; and greater differentiation in the learning infrastructure;

- a delivery plan that clearly articulates the roles and responsibilities of the main stakeholders and agencies including a major role for the public sector to lead by example.

The Learning and Skills Council will roll out the Great Skills Debate - a series of consultation seminars - across England from April, where local employers and businesses can discuss and comment on issues within the Skills Strategy. The Government will unveil the final Skills Strategy in June.