Human skills means how to tackle people, how to use their skills, how to work within a team. Human skills are cooperative efforts; it's teamwork.
Human skills are very important at all the level of management because if you want to manage your business you cannot do without the cooperation of your subordinates. In management a phrase is very popular that is " treat people as human beings", if someone is a first line manager then he must posses the skills that how to getting work done by the labors, how to motivate them, how to facilitate them. Needs of using human skills is decreased with the level of management but it doesn't eliminated, therefore in all the level of management the manager should be kind and treat their candidates as colleagues not as competitors. He must have skills to listen people and not to only listen them giving better solution for their problem is the biggest responsibility for him.
SOURCE: http://wiki.answers.com/Q/Why_are_human_relation_skills_important_at_all_levels_of_management#ixzz1OssHSAaH
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