There’s a world of difference between South Korea and South Yorkshire. One is among the most technologically advanced nations on earth where every home has a broadband connection to the internet. The other is one of the most deprived regions in Europe, still feeling the effects of the collapse of the steel and coal industries nearly 20 years ago.

In the 1980s, 75,000 people in Sheffield - one in four of the workforce - lost their jobs. Unemployment had a devastating effect, but most outsiders only saw the funny side, courtesy of hit film The Full Monty, about a group of former steelworkers turned male strippers.

“People feel very ambivalent about that around here,” says Steve Farnsworth, deputy director of education. “It put Sheffield on the map but it also gave it the image of being clapped out and hard done to.”

South Yorkshire’s hard times led to Sheffield - along with neighbours Barnsley, Rotherham and Doncaster - being granted Objective 1 status by the European Union, the top grading for regeneration grants. Funds to rebuild its ravaged economy soon followed. The city centre is showing the benefits of this cash with redevelopment of roads, office blocks and public spaces like the Millennium Gallery and the Winter Gardens.

But Sheffield could soon be challenging Seoul in the IT stakes. The latest project, a less visible, but hugely influential, scheme to equip thousands of people with skills for the 21st century, is taking shape.

It may seem a daunting ambition, but then so is the scale of the South Yorkshire e-learning project. Between now and 2006, more than pound;50 million will be spent on computer infrastructure and training, more than 140 schools, colleges and community centres will be networked with wireless laptops and whiteboards and 37,000 people will get access to online learning, training and qualifications.

“People just haven’t worked on this sort of scale before,” says Steve Farnsworth. “It dwarfs anything else being undertaken here or in Europe.” A virtual learning environment - provisionally called e-sy.info - will be created for all of South Yorkshire’s 200,000 secondary pupils, enabling them to do everything from research and submit assignments to apply to university or college - one of the first times that Objective 1 money has been used for schoolchildren.

Around half the venues to be upgraded will be community centres, libraries and other public places. South Yorkshire has one of the lowest rates of internet access and home PC use in the country so another feature of the project will be an affordable leasing scheme whereby people can rent computers for around pound;5 a month. “The project can’t afford to buy everybody a PC,” says Steve Farnsworth, “but it can give them access to technology at home”. “We don’t want to buy truckloads of laptops and just give them out - that would be a disaster.”

The programme is based on an economic argument as much as an educational one. Hundreds of jobs will be created in the short term as at least 270 trainers will be taken on. The contract-winning consortium (due to be chosen from a shortlist of two in March) will open new offices in the area.

Five thousand jobs will be created at an e-campus business park to be built on the outskirts of the city centre. In the long-term, the hope is that the newly skilled workforce will attract investment from IT-based businesses.

The first signs of this huge investment can be seen at The Source, a pound;4.5 million health club, cafe and training centre that opens at Meadowhall, the out-of-town shopping centre, next month. The name is well chosen because, as its director, Ann Cadman, explains, it will be a starting point for people to improve their minds - and bodies. “Some of the programmes offered in the centre will have a holistic approach, looking at mind, body and spirit,” she says.

The Source is well placed to fulfil its potential. It has a captive audience in the dozens of major employers and 7,000 people who work in the Meadowhall centre. Many are already committed to using the centre’s conference and training facilities.

It also has the M1 and Sheffield’s tram service on its doorstep and is within an hour’s drive of eight million people.

It is hoped shoppers will drop in for coffee and join a gym class or taster course. “Some people find it difficult in a classroom situation and often don’t like to admit they don’t know a way into learning,” says Cadman.

The opening of The Source - another is planned for Doncaster - comes at a symbolic time for Sheffield. Eighteen months ago, an era ended when the city’s education department left its old premises in Leopold Street. Built in 1879, this collection of Victorian buildings was established by steelmaster Mark Firth for the technical education of craftsmen. It spawned Sheffield University.

Herbert Wadge, principal of the central technical college once there “had a profound lifelong influence on all his pupils,” a plaque solemnly proclaims.

The hope is that, by the time the funding runs out, The Source will have become as influential in the fortunes of the city’s people at the forefront of education and training in the 21st century.