Grammar and spelling are extremely important, as are basic knowledge of history, geography, etc. There are young people in this country who have no idea of the relationship of towns and cities to each other, or which towns are in the north or south. Many adults seem to have no idea where they are going, in which direction, when they jet off on holiday.
I'd say yes to youngsters being better at technology etc., but no to them having to use their own imaginations for play games, story telling etc. - it's all in front of them on the tv or game console these days. Personal interaction seems often missing.