From my blog
For some reason, the Friedman book linked from http://cluster.tribe.net/tribe/servlet/template/ViewThread.vm?threadid=2a6f2b79-9a72-4fbf-9b0f-cdda341f8894&tribeid=4354f356-567e-4688-9447-00397e48914f here stimulated this outpouring from me.
I think the Blairite, education first policy is totally busted.
It basically offers the following diagnostic : "Sure business isn't very responsible to the people who work for it. But that's really the fault of the workers. Business has real and justifiable needs.
Sadly, the workers don't fulfil those needs right now. But if they only take responsibility for educating themselves better, and are willing to learn and adapt faster, then they'll match the requirements of business, and things will be fine.
Now, we understand, that maybe the workers require some help to achieve this level of flexibility and productivity. Perhaps they were let down by previous education regimes. But now we have the technique and the will to make that OK, and help people out of their predicament."
But is there a natural limit to the increasing demands that business will make on the worker? And is that limit lower than the human breaking point? (Business? Sod it! Let's call it by it's name : capital)
There's almost no evidence that capital regulates itself to respect the idea of natural human limitations that it won't try to go beyond.
Will business put workers lives at risk (and stochastically kill them) to save money on safety features? Sure, does it all the time.
Will it employ 8 year old kids in factories? Yep.
Will business employ teenage girls 15 or 16 hours a day without break? Check!
Will it feed them amphetamins to keep them awake beyond their natural sleep patterns? Happened in Guatemala. 
: (Counter-argument : could be said that there's a similar lack of mechanism to stop-wrong doing in democracy too. Though off the top of my heads, I can't think of any democratically elected governments who've done these things.)
Again, what time-scales does business respect?
Here we have a great example from international currency trading. Theoretically, currencies are bought and sold to represent the currency markets' faith in the underlying economy of countries. In fact, as we all know, it's speculative gambling. The dealer in New York who's about to take a punt on the Brazilian "Real" isn't waiting to see if the Brazilian farmer can get up to speed on new technologies before he makes his assessment.
Capital has NO sense of time-scale except to try to compress it. And now we're seeing wonderful deeds in SupplyChainManagement. Dell puts a computer together, to order. It can switch most of it's component suppliers in an afternoon.
The quote that an engineer's knowledge is out of date in three years is interesting. But that may soon look sluggish. If it suited business that product lines evolved so fast that the engineer's knowledge was out of date in 3 weeks, or that suppliers changed several times an hour, that's the way it would be.
Now how is the educated worker protected from this acceleration? Not at all. In fact, in some ways, she's worse off than her less educated sister.
1) If the job lasts the same length of time and pays the same, she's made a bigger investment in her skills for the same return.
2) If the job involves more information processing, then it can probably be moved around the world, really easily.
Basically, the Blairite line is "give business what it says it wants today, and hopefully it won't want more tomorrow." But that's looking increasingly implausible.
 According to NaomiKlein
I think that unfortunately (or perhaps, naturally?), the educationamal system (at least here) is pretty much set up as one foundational cog in the whole capitalist working class machinery. I'm not saying it doesn't offer people the opportunity to do what they want to do, and it could be worse/more obvious, but it is now an expectation of education to give you the ability to earn more money than if you hadn't been educated. The entire system is set-up so that you genuinely "graduate" towards an employer-friendly personality/CV. There are a couple of problems, in my eyes, with this:
Firstly, as you've pointed out, if the jobs market is becoming increasingly smaller (or rather, there is a [shift http://www.statistics.gov.uk/cci/nugget.asp?id=12 shift in job demographics]), then how does education change to take this "sellability" into account? And, indeed, is it capable of keeping up in the long-term?
Secondly, it bypasses a lot of "things" that would otherwise make us, personally, more fulfilled, without having to ultimately cater and tailor ourselves to potential employers. By this, I mean that there isn't enough emphasis on "attitude" or perhaps "outlook" skills (damn, this is really vague) that would serve us just as well in life, if not better, than if we had been taught to promote ourselves.
I don't think I've explained myself very well... I'm still recovering from a late night and some fine Scotch. But couple the above with an education system designed upon managerial principles stemming from the military and prisons (think uniforms, methods of control, et al), and the ongoing top-down mishandling of much of it by the government, and it all starts looking a bit... murky.
Actually I don't think the education I went through did all that bad a job at giving me a mix of practical skills like reading, writing, bit of maths (no, actually my maths education was lousy), science, history etc. and self-actualizement like "write some poems", "do drama", "play sport", "research something that interests you" etc.
My problem is when government thinks that it can use an emphasis on education to duck out of facing the hard conflict with capital. And when it thinks that it can finesse the conflict between capital and the public interest as a mere problem of a mismatch between the skills of the workforce and the "needs" of industry.
Of course there's got to be a balance between what you're calling the 'needs' of industry and the basic rights of a worker. But industry can only survive if it makes things that society buys (so the needs are ultimately 'needs' of societies in one way or another) ... and you surely cannot be suggesting that the government should not care if its adult population lacks skills useful for industry today.
Well actually, one understanding of what you might be saying is a sort of 'let's privatise all vocational training because govt do it so badly anyway'. In otherwords, let tax payer funded education focus on basic education, socially useful skills and academics. Then let all vocational skills be the responsibility of industry to do training 'on the job' in an appreticeship style way.
This may be a good way to go ... don't know ... but would, I think, put a big question mark on how many publically funded universities a country like UK could realisitcally afford to maintain for the purpose of training school teachers and academics.
I wouldn't like to go down such a road. I would rather that universities do try to continue to undertake mass vocational training to high standards ... and thereby we can economically justify trying to increase the number of people staying longer in the educational system.
However, I do think that an interesting assumption of the last decades might turn out to be false. The general assumption was (I believe) that globalisation would mostly take 'low skilled' jobs abroad. Therefore a country like UK could 'defend' itself against this outflow of jobs by moving the population mostly towards 'high skilled' jobs.
It turns out that quite a lot of high skilled work can be done via remote working.... in India for example. Shifting bits is much cheaper than shifting 'stuff'.
So, it may be that we are 'over educating' our workforce. You can't fix a leaking tap in Hove from India. Nor can you serve coffee or flip burgers at that distance. And you don't need a degree to do these jobs.
Indeed, I think the current govt is so skeptical of the economic social value of publically funded mass higher education that it has introduced the tuition fees. With a now-not-quite-so-crumbling-but-still-could-do-with-more-money health service, where should the priorities for tax money be?
Then, the battle with capital, I think, should be 'fought' on other fronts: 1) tax, 2) intellectual property. Mass public higher eductation, however, can only be justified if it usefully skills the workforce.
Personally I would rather see more public money spent on research for the public good in favour of this emphasis on mass higher education. My greatest 'fear' of capital is just how much it 'owns' the scientific and technological research agenda.
Actually my point wasn't to criticise Blair's approach to education. Though I think it's cementing a lot of historical wealth divisions, as people from poor families and communities simply stop going to university. My main point was that government's responsibilities to the social good don't end with improving the education system. It can't duck the conflict with the market in other areas. An education policy isn't enough.
I agree on the vocational training thing. You can't separate socially valuable from commercially valuable. Pretty much everything has both qualities; and the government should be involved in training for and promoting anything it considers to be useful.
Seems it's the Bushite one too : http://www.prospect.org/web/page.ww?section=root&name=ViewWeb&articleId=8742