Young people do not have the right attitudes for the world of work, according to employers.
Many businesses see a youngster's mindset and general aptitude for the workplace as more important than academic results, but fear school leavers are lacking these vital skills, the CBI/Pearson annual education survey reveals.
It also warns there are continuing concerns about the literacy and numeracy skills of workers, with many firms admitting that they have laid on remedial classes for employees.
And it suggests that while many employers are looking for staff with degrees in science and maths-based subjects, some have reservations about both the quantity and quality of these graduates.
The CBI's survey is based on responses from 291 companies collectively employing nearly 1.5 million people.
The findings show that around three fifths (61%) are concerned about the resilience and self-management of school leavers, while a third (33%) are worried about attitudes to work.
At the same time, employers rate attitudes to work and a young person's general aptitude as their top priority when recruiting (85% and 63% respectively), ahead of literacy and numeracy (44%) and academic results (30%).
The report suggests that since attitude is the "single most important consideration" when young people are seeking their first job, " developing a constructive attitude during their schooling is fundamental to working life".
CBI director-general John Cridland said: "We're looking for young people that are rigorous, rounded and grounded. The Government has spent a lot of time improving the rigour of studies and qualifications, which is something we support.
"But businesses put more emphasis on attitudes than academic results. It's the rounded and grounded part that isn't always there.
"Young people today are more streetwise than my generation, they've been to more places, seen more things, their view of life is very streetwise. What's lacking is those skills you need to be able to work with people effectively - working as a team, self-confidence, self-discipline.
"We think young people are leaving school unprepared for the fact that the world of work is a very different environment to school."
Mr Cridland said that youngsters should not be given lessons on work skills, but should learn them as a general part of their education.
"The worst thing schools could do is teach it as a separate subject," he said "The last thing we need is a GCSE in employability."
He argued that young people do not have access to decent work experience that would teach them about the working world and a problem still exists with school careers advice, which is failing to give young people the help and support they need.
Just over half (52%) of firms want schools to improve awareness of the working world among 14 to 19-year-olds with support from businesses.
Two thirds (66%) of employers said they were willing to play a bigger part in the school careers system.
The CBI said it was calling for Ofsted to be overhauled to ensure that both academic progress and "development of character" are a priority in schools.
The report goes on to say that while most employers rate the overall skill levels of their employees as satisfactory, over half (54%) are aware of weaknesses in literacy among at least some of their staff, while 53% said the same about numeracy and 61% said the same of IT skills.
Around 44% of those questioned have organised remedial training for adult employees in at least one basic skills area in the last year, while 28% have done so for young people joining them from school or college.
Mr Cridland said: " This summer, as every summer, around 30% will leave the education system without the literacy and numeracy they need to get them through what could be 55 years of working life. They have been failed by the system."
He suggested that the problem starts early on, with children who are behind at the end of primary school less likely to gain good GCSEs at age 16, while some youngsters are starting school already behind in areas such as vocabulary.
"We are trying to put things right that have already gone wrong," he said. "We need to get them right in the early days."
Some 85% of those questioned said they want primary schools to focus on developing pupils literacy and numeracy skills (85%), the survey found.
The survey also found that 48% of firms prefer graduates with STEM (science, technology, engineering and maths) degrees, but 46% have concerns about the quantity of these graduates and 48% are worried about the quality.
Mr Cridland said that there are concerns that not enough people are studying science and maths, adding that schools and universities need to make sure that their courses keep pace with the world of work and technology.
A Department for Education spokesman said: "This report underlines why our measures to raise standards are so desperately needed.
"We are demanding more through a tougher curriculum and world-class qualifications. We are ensuring young people who don't have at least a C grade in GCSE English and maths - the two subjects most valued by employers - must continue studying those subjects up to the age of 18.
"And we are transforming vocational education, improving apprenticeships and opening dozens of university technical colleges and studio schools so that school leavers are ready for the world of work."