Lithuania experienced strong negative changes to gross domestic product (GDP) after independence, but the trend has reversed since 1994. Labor force participation and employment rates for 15-64 year-olds has decreased; the unemployment rate is 17 percent. Employment has increased in the services sector but decreased in agriculture, which accounts for a large proportion of employment. Educational attainment is high, with a strong bias in favor of higher education. Participation in labor market and continuing vocational training remains low. Public expenditure on formal education fluctuates around 6 percent of GDP. Public expenditure on vocational schools decreased from 2% of total national budget expenditure in 1999 to 1.7% in 2001. This corresponds to a decrease in total vocational enrollment, from 56,000 in 1998-1999 to 47,000 in 2000-2001. Laws aim to combine the various strands of education and training to develop a comprehensive system, but lack of funds leaves many actions unimplemented. Policy development shows considerable overlap and duplication of effort. Public support for continuing vocational training is limited to labor market training for the unemployed and those in danger of redundancy. Lack of developed links between initial vocational education and labor market training makes adult participation in labor market training difficult. Well-established public employment services play an important role in implementation of national employment policy. Lack of and large variation in resources across areas limit Lithuania's capacity to implement coherent employment policies. (Appendixes include a 105-item bibliography and 33 figures.) (YLB)