This policy study of official efforts to develop the relationship between education and employment in the United States focuses on both the transition of youth from school to work and the education and employment system for adults. Federal legislation is overviewed, and federal programs for youth to improve the relationship of education to employment are described. Federal budget policy is briefly overviewed. Overall progress by programs toward policy objectives is assessed. Results cited are worsening youth unemployment; poor quality youth employment; lack of marketable skills; limited occupational socialization; no certification of competencies; no job placement assistance or private sector linkages; constant dropout rates; and little investigation of the relationship between creation of job opportunities and delinquency prevention. Federal policies pertaining to career and life redirection and renewal among adults are described, including emphasis on lifelong learning or recurrent education and support of training designed to meet critical personnel needs. A case study is presented of Seattle's education and work delivery system. Probable directions for the federal government are then identified, including job creation and income maintenance strategies; legislation reauthorization; and postsecondary, continuing, and lifelong education. (A foreword discusses the socioeconomic and cultural context of educational development in the Europe region.) (YLB)