It is widely accepted that to produce high value products and services requires a welltrained and skilled workforce. This paper seeks to make a contribution to unpicking the relationship between business strategy and skills in the service sector by presenting research findings from the UK fitness industry. This sector has been fast growing and includes companies who compete on the basis of high quality, alongside those competing largely on cost. If the route to a high skills economy is to shift firms to higher quality products, then we would expect to find that the more up-market employers make use of a workforce with higher levels of skill. The research from the fitness industry questions this simple relationship, finding that there is no clear link between competitive strategy and skills. As quality is not necessarily the impetus for improving the skills of the workforce, the paper then briefly explores the possible skill implications of a number of other developments currently taking place in the industry.
