The structure of the modern school system (the one employed in the western world, at least) dates back to the Industrial Revolution. It's hardly "a reflection of the needs of a modern knowledge economy".
The modern school system dates back to the industrial revolution, but has continued to evolve in the direction of longer school days, less physical activity and free play, and more material. All this is consistent with the increasing demands as we transition from an industrial economy to the modern economy.
