A new ladder of vocational progression, leading from schools to degree level, is to be created to help tackle Britain's skills gap.
Further education and sixth- form colleges will be encouraged to work closely with schools and employers to build the lower rungs of the ladder, which is designed to lead on to higher education through the new foundation degrees.
Education and employment secretary David Blunkett launched the scheme at the Institute of Economic Affairs in London on Wednesday.
In a pamphlet, Education into Employability: The Role of the DFEE in the Economy , Mr Blunkett says the future expansion of higher education "will be focused heavily on foundation degrees and vocationally orientated study by those in their 20s".
He adds: "In this way, we are making a reality of the long-cherished aim that individuals should be able to progress through the technical and vocational pathway all the way to a degree.
"Choosing technical and vocational education will no longer be seen as an option which limits ambitions."
The pamphlet calls for a "radical, new, integrated approach" to "confront head-on the present and future skills need of employers".
This will mean continued investment in training initiatives from the government, together with significant improvements in guidance and information to help employers and individuals choose appropriate training routes, it says. At the same time, both employers and employees should be encouraged to invest more in training.
The new Learning and Skills Council for post-16 education and training will have a key role to play in the scheme, bringing together education and skills training into a single planning and funding system.
Mr Blunkett adds that the economic role of the Department For Education and Employment had been "worryingly underplayed" in the past.
His message echoed comments made earlier in the week by industry minister Kim Howells, who suggested that much of college and university education is irrelevant to industry.