Only Greece, Mexico, New Zealand, Portugal and Turkey have worse figures for the proportion of 17-year-olds continuing in education, the annual study by the Organisation for Economic Cooperation and Development has concluded.
The report, Education at a Glance, revealed that one in four UK pupils leaves education at 16, eight percentage points lower than the OECD average.
It also warned that the UK faced a widening social divide which put youngsters who left school at 16 at an economic disadvantage for life. Meanwhile young people who go on to university receive one of the largest boosts to their earnings of any industrialised nation. British graduates earn 78 per cent more than non-graduates, and school drop-outs earn one third less than those with A-levels.
Andreas Schleicher, head of the OECD's indicators and analysis division, suggested that the UK curriculum could be to blame. He argued that other countries were better at keeping teenagers in education because they had been more successful at developing courses which appealed to young people.
"In some of the countries that have very high levels of attendance what's different very often is the great variety of programmes - combining learning at school and in the work place, vocational and general courses," he said. "There is a choice for students."
Bill Rammell, the minister for Lifelong Learning, admitted that more needed to be done to persuade disaffected young people to stay in education.
"One of the biggest and most immediate challenges facing us is to encourage more teenagers to stay on in education," he said. "We remain concerned that the skills levels of our school-leavers are too low and we are determined to take the necessary steps to ensure we can satisfy the rising and changing demand for skills."
The report also revealed that the UK has slipped down the education league tables since the 1960s, with the number of pupils leaving school with basic qualifications failing to improve. Since the 1960s, the UK has fallen from 13th place to 22nd in the rankings of the proportion of pupils with GCSE-level qualifications. South Korea has leapt from 24th place in the 1960s to first position.Reuse content