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This chapter sets the analysis of education and training systems against the background of major developments in the global economy. The authors consider the changing demands for skill that education and training systems are designed to meet. They argue that, even in the advanced industrialised world, it is too simple to assume that all countries are converging to a common modern technology in which ever-increasing and broader skills are needed from modern national workforces. They bring together the evidence on a range of macroeconomic phenomena including growth rates, unemployment, the wage level and income distribution, all of which point to heterogeneity in the economic developments of nations. The authors suggest that this will be reflected in the skills demands of employers, in the skills supplied by national institutions and in the skills actually used in modern economies. Finally, they look at the implications for skill trends and describe how researchers have examined them.