The report, The Apprenticeship Journey, found that 81% of small business owners are 'not very confident' or 'not at all confident' that students leaving school at 16 have the right level of employability skills.
It revealed that 77% of employers believe school leavers business awareness was either poor or very poor. And more than half of FSB's members have called for greater emphasis on employability skills in schools.
The report also showed the apprenticeship programme has been stretched to include functional skills that help make up for failings in the education system. It suggests this undermines the confidence of businesses in apprenticeships and, significantly, creates a 'poor image of apprenticeships' in the eyes of teachers, school leavers and parents.The report stated: "The Government has failed to articulate a clear definition of what constitutes an apprenticeship.
"For too long businesses have been left on the sidelines as they are not in charge of the funding that the apprenticeship receives. To address these issues, the FSB recommends:
- Giving businesses the autonomy to draw down funding and buy what the apprenticeship needs and not what the provider wants to deliver. Once businesses are in control of training, their perception of and participation in apprenticeships will improve.
- Government should work with employers to produce an agreed definition of an apprenticeship so that everyone knows what they are.
- Functional skills should be removed as a core element of the apprenticeship. Business expects functional skills such as numeracy and literacy, to be delivered in schools.
John Walker, national chairman, FSB, said: "Research has shown that eight out of 10 small firms believe school leavers are not ready for the world of work.
"There is a role for schools to provide employability skills before pupils leave full-time education. All young people need to be offered a variety of work experience opportunities during full-time education and have a good level of work-related learning."
David Barlow, training and development director at electrical training firm, Barlows UK, said: "Apprenticeships provide a great opportunity to bring enthusiastic young people in to a business and train them with the skills that exactly meet the organisation's needs.
"Apprentices are a true asset to the workforce and I passionately believe more employers should hire them."
The results of the FSB online survey are based on the responses of 2,744 memebers of the FSB.