Implications of new government approaches to manpower planning and its relationship to higher education in Ontario are examined. In January 1980 the Council of Ontario Universities released a background paper on the employment of university graduates, which reviewed the current major economic and demographic analyses of youth unemployment, the employment experiences of university graduates, and projections of future demand for highly qualified manpower. The impact of perceived and actual employment problems of college graduates on education policy was also considered. More recent studies of the labor market show imbalances between university output and labor market demand. Emphasis has shifted from the plight of the unemployed or underemployed graduates to the economic impact of shortages of skilled and highly qualified manpower. Government reports have suggested that university programs and enrollments are more closely matched with labor market requirements. The effects of this viewpoint on Ontario universities and higher education in general are reviewed. Relevant sections of government reports and the rationale and techniques used to support this planned approach are analyzed. A bibliography is included. (Author/MSE)