For some time now, ‘employability’ and ‘competence’ have been seen as issues of high importance for the discussion of policies for youth transitions. When this discussion is raised in relation to youth development, a number of current changes have to be considered. In a late modern world, changes are fast and all-inclusive. Labour market and qualification structures constantly evolve and the organisation of educational systems is subject to continuous political discussion and alteration. Moreover, individual development and individual learning perspectives are in constant flux.

Although they are often discussed, this does not mean that the issues surrounding competence and employability are clear and simple. The many perspectives expressed about modern development, labour market demands, youth life and individualisation make it difficult to clarify and agree about the meaning of the two concepts.

Competence may be defined thus:

Hence, in this professional definition, competence refers to a context or situation, but is seen as a form of personal characteristic. Competence refers to the situation but may also be learned by the individual concerned.

Employability, on the other hand, is perhaps even more difficult to define. It may be defined as being useful or valuable in a labour market situation. In this way, it refers to a field of contexts without pointing to a specific context.

Competence and employability may be conceptualised as separate issues. In a labour market context, competence refers to the individual supply structure and employability to the labour market demand structure.

Looking closer, however, competence and employability appear to be the same issue seen from different perspectives. Both competence and employability point to the individual practice of knowledge and skills. From the demand perspective, employability asks what sorts of knowledge and skills are required for different persons in different positions in the labour market. From the supply perspective, competence points to existing personal skills and knowledge and the way in which they refer to labour market demands.

In everyday discussions, competence is often seen as some sort of private modern personality quality and employability as the demand of ‘a total individual fit’ to whatever is needed in the labour market.