Eight in 10 firms are concerned that school leavers are not prepared for the world of work, a poll suggests.
It believes there are still widespread concerns among small businesses about young people's literacy and numeracy skills.
The survey, which questioned almost 3,000 companies, also reveals worries about school leavers' self-management skills as well as their ability to work in teams and communicate.
In total, 81% of the firms questioned by the Federation of Small Businesses (FSB) said they were not confident that school leavers are ready for work.
Over two-thirds (69%) said they rated school leavers' literacy skills as poor or very poor, while over half (55%) said the same about their numeracy skills.
None of the small businesses polled said they thought literacy and numeracy skills were excellent, while 17% said they thought numeracy levels among this group were good, and 15% said the same for literacy.
The rest were unsure or thought these skills were neither good nor bad.
When it comes to workplace skills, more than half (56%) thought school leavers' communication skills were poor, 77% said the same about their business awareness and 31% said the same about team-working skills.
The poll also reveals that 57% of small businesses think that school leavers do not have a positive attitude and are poor at self management.
FSB national chairman John Walker said: "It is a concern that businesses have again highlighted numeracy, literacy and communication as major problems. We want to see schools give these skills a higher priority by embedding them in all teaching from an early stage."