The report, by the British Chambers of Commerce (BCC), found 69 per cent of businesses think that secondary schools aren't equipping their students with the skills they need for work.
"When you also consider two-thirds of businesses told us they think schools are not effective at preparing young people for work, it is clear that there is more to be done to help students get on the career ladder," John Longworth, BCC director general, wrote in a guest column for City AM published this morning.
The survey, of more than 3,200 businesses, found firms feel schools need to put more emphasis on teaching work skills in their curricula, hold recruitment lessons and practice interview techniques and put businesses in closer touch with the schools to make sure their students excel after secondary school.
The BCC also found 41 per cent of businesses thought universities were doing a poor job at preparing students for their future careers.
To blame? The National Union of Teachers has pointed to government policy and cuts to work experience and work-related classes.
Kevin Courtney, deputy general secretary of the NUT said: "The government's insistence on a narrow focus on exams in 'academic' subjects, in conjunction with a weak offer of vocational courses and qualifications, further undermines the link between education and the workplace."
However, the UK's youth unemployment - which currently stands at 14.2 per cent - is two percentage points lower than this time last year, data published by the Office for National Statistics today showed.