The Department for Employment and Learning will look at whether the 17 general FE colleges are attempting to do too much.
"It is timely to take stock after the first four years' experience of incorporation," Robson Davison, deputy secretary at the department, told the Association of Northern Ireland Colleges' conference on Tuesday. "There have been a number of developments since incorporation, especially devolution, which have had an impact."
He was speaking on behalf of Carmel Hanna, minister for employment and learning, who was on a trip with Margaret Hodge to Bratislava. Ms Hanna, from the Social Democratic and Labour Party, has been in post since December and many delegates felt, as the minister of a devolved Government, she should have put the conference first.
"The minister is also anxious to explore the relationship between the FE sector, employability and economic development," said Mr Davison. "This will lead us to consider the sector on a very broad canvas and to answer some fundamental questions."
The department will consider whether to make funding more closely related to economic regeneration, putting a greater emphasis on part-time provision and distance learning so the workforce can be re-skilled, and whether the sector is "attempting to cover too many areas of work".
It will look at other models of further education, including the community college system in the US, as well as the effects of new funding arrangements overseas, including the advent of the Learning and Skills Council in England.
He said there is a clear mismatch between the aspirations of young people and the needs of employers. "Too many young people are entering vocational education in narrow areas and too few in areas such as ICT, engineering and manufacturing," he said. "We do not, therefore, produce sufficient engineers, scientists and computer people for a potential expansion of the knowledge-economy.