"Workforce Skills and Innovation: An Overview of Major Themes in the Literature" by Phillip Toner

This paper provides an account of the main approaches, debates and evidence in the literature on the role of workforce skills in the innovation process in developed economies. It draws on multiple sources including the innovation studies discipline, neoclassical Human Capital theory, institutionalist labour market studies and the work organisation discipline.

Extensive use is also made of official survey data to describe and quantify the diversity of skills and occupations involved in specific types of innovation activities.

TABLE OF CONTENTS
ABSTRACT
1. WORKFORCE SKILLS AND INNOVATION
Introduction
1.1 Structure of the report
2. DEFINING SKILLS AND INNOVATION
2.1 Social sciences, innovation and skills
2.2 Defining skills
2.2.1 Conventional approach
2.2.2 Inter-country differences in the meaning of skill
2.2.3 Changes in education, qualifications and occupations over time
2.2.4 The ever expanding scope of ‘skills’
2.3 Defining innovation
2.3.1 What is innovation?
2.3.2 Innovation activity and skills
2.3.3 Occupational structure of the R&D workforce
2.3.4 Radical and incremental innovation and workforce skills
2.3.5 Learning by doing and using
2.3.6 Innovation, product cycles and skills
2.3.7 Innovation in service industries
2.4 Benefits of higher skills for innovation
2.4.1 Accelerating technical change
2.4.2 Adapting to technical change
2.4.3 Complementarity of education, training and innovation
2.4.4 Complementarity of capital investment and skills
2.5 Empirical studies of intermediate workforce skills and innovation
2.5.1 Matched plant studies
2.5.2 National differences in the structure of exports and imports
2.6 Reasons for increased academic and policy interest in skills and innovation
2.6.1 Rising educational attainment
2.6.2 Skill shortages
2.6.3 Demographic change
2.6.4 Globalisation and competition
2.6.5 Changing work organisation
2.6.6 Technological convergence
2.6.7 Changing industrial structure
2.6.8 Consumer demand
2.6.9 Importance of low technology industries
2.6.10 Contribution of human capital
2.6.11 Neoliberal policy
3. APPROACHES TO THE STUDY OF SKILLS AND INNOVATION
3.1 Neoclassical human capital and skill biased technical change
3.1.1 Skill biased technical change
3.1.2 Criticisms of skill biased technical change
3.2 Institutions and national differences in skill formation regimes
3.2.1 Occupational labour market
3.2.2 Internal labour market
3.2.3 Flexible labour market
3.2.4. Criticisms of institutional approach
3.3 High performance work systems
3.3.1 Features of HPWS
3.3.2 Growth of HPWS
3.3.3 Key workforce skills for HPWS
3.3.4 Criticisms of HPWS
4. CONCLUSION AND POLICY IMPLICATIONS
4.1 Areas for more research
REFERENCES

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