How old are new skills?

OECD Directorate for Employment, Labour and Social Affairs

The knowledge economy requires a host of new competencies, but basic skills remain an essential tool of 21st century living. 

New technologies were for a long time confined to specific occupations and sectors of the economy, but they are now in widespread use. They have become an integral part of daily life and are radically changing trade and the development of communications around the world. Individual levels of education and training are also constantly rising. If the knowledge economy is to expand, every individual – not only those in work – will have to be able to use, handle or produce information. Mastering new skills has become a necessity outside the workplace, to watch interactive television, use the Internet or simply withdraw money at a cash point.

Yet the importance of traditional skills has not declined. Moreover, people do not master them as well as one might think. As the International Adult Literacy Survey (IALS) showed, more than a quarter of all adults in OECD countries do not have adequate skills to function in today’s complex society. While the survey focused on people’s ability to understand and use texts and illustrated documents, it revealed that far more was at stake. The massive influx of electronic tools onto the market has made writing and reading the most important skills anyone should possess. Paradoxically, the Internet revolution, electronic mail and global information flows are turning reading and writing into skills that no-one can do without, be it to search an Internet site or to apply for a job by e-mail. The range of absolutely essential core skills has broadened from cognitive skills, whether developed in initial education or elsewhere, the ability to handle information and to use a computer, and knowledge of one or more foreign languages.

In addition to these basic skills, there are others that are sometimes described as new and that give people control over their future in society and in the work-place. But these new competencies do not replace traditional skills; they complement and extend them, well beyond the world of work. Team-working, problem-solving and ICT (information and communication technology) skills are helping people to play a full role in society and exercise their rights and duties as citizens. The IALS showed a worrying correlation between economic inequality and different levels of literacy. Promoting basic skills has always been key to individual and collective success, and the odds are that this applies to the new competencies too.

There is no consensus, however, on how to define these new competencies. Many authors have confined their research to the economic dimension, probably because these skills play a key role in determining access to employment. There are other explanations behind this focus on the economic dimension. Growth has recently been much stronger in knowledge sectors, which use the new competencies more intensively, than the rest of the economy. It is therefore not surprising that the clearest evidence relates to the labour market, employment and economic growth, whereas it is society as a whole that is involved.

Most studies agree on a set of core skills. Leadership figures highly on this list, as do other relational skills, such as the ability to work in teams and aim towards a common goal. It also includes personal skills, such as motivation and a predisposition to work, the ability to learn and to solve problems, the capacity to communicate effectively with colleagues or clients, and the ability to analyse. Not forgetting, of course, technological skills, like mastering new information and communication techniques.

That these competencies are required in the knowledge economy is hardly surprising. But they are not necessarily new. With the exception of ICT skills, they are hardly cutting edge. Why should these relatively traditional skills have come to the fore on the employment scene now?

A large part of the answer is the fact that employers were the first to recognise such skills as key factors in dynamism and flexibility. A labour force with these skills can continuously adapt to constantly changing demand and means of production. What is more, production in OECD countries tends to focus on high-value-added goods requiring high-tech production methods and a labour force able to use them. New technologies in business have also generated higher demand for skilled workers. The ability to communicate and work in a team, vital even in the days when fields were ploughed by hand, has become more essential now. New work practices, with flatter hierarchies and greater worker involvement at lower levels of responsibility, go hand in hand with the competencies demanded today.

The clear improvement in levels of education is also making employers more demanding. The OECD economies have always operated on the basis of qualifications rather than skills, which are by their very nature harder to assess. Even today, formal knowledge and paper-based qualification are important criteria for employment selection. But the new competencies provide additional criteria when recruiting people and matching jobs to skill profiles. In other words, and this is crucial, new competencies are not replacing, but comple-menting initial education and training. Further research is required to gain a broader picture of the knowledge and know-how individuals actually possess. The IALS survey and the new survey on Adult Literacy and Life Skills (ALL) are steps in that direction.

There is clear evidence from every sector of the economy that the labour-force mix is made up of workers who are better educated and/or possess broader skills. However, the link between the new competencies and the knowledge economy is not a direct one, with the possible exception of ICT skills. There is, on the other hand, a much clearer link between the new workplace practices and competencies such as communication, problem-solving and teamwork.

While some of these competencies are not necessarily new, the adjective is still relevant in that greater efforts have been made to formalise them. These new competencies are quite distinct from basic skills like literacy and those acquired in the formal education and training system. Some are clearly associated with the knowledge economy, such as ICT, and an even greater number relate to new workplace practices. Sooner or later, every sector will be affected by new technologies, even the occupations traditionally viewed as low-skilled. It is the combination of these new competencies and basic skills together that will provide a more comprehensive response to the demands of the knowledge economy and to the challenge of more global skill requirements.


• Bresnahan, T.F., Brynjolfsoon, E., “Information Technology, Workplace Organisation and the Demand for Skilled Labour: Firm-Level Evidence”, NBER Working Paper No. 7136, 1999.

• Kiley, M., “The Supply of Skilled Labour and Skill-Biased Technological Progress”, The Economic Journal No. 109, October, 1999. 

• OECD and Statistics Canada, Literacy in the Information Age: Final Report of the International Adult Literacy Survey, 2000.

• Pont, B., and Werquin, P., “Literacy in a Thousand Words”, OECD Observer No 223, October, 2000.

• Pont, B., and Werquin, P., “Competencies for the Knowledge Economy”, in Education Policy Analysis, Chapter 4, OECD 2001.

©OECD Observer No 225, March 2001 

Economic data

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