Integration of young people into the labour market is an issue of a high priority. The youth unemployment problem has explicit links to the vocational education and training (VET) system. Since 2009 there is an ongoing reform in the Latvian VET system. In this respect also the role of local governments increases. The paper addresses the issue of introducing innovative approaches in the Latvian VET system. The aim of the study is to estimate the overall readiness of public administrations to implement VET reforms within regional economic development in the context of the EU and national strategic priorities.