"Demand-led learning", which takes account of what employers want, is being applied too rigidly, said Mary Bousted, general secretary of the Association of Teachers and Lecturers.
At a union seminar last week, she said: "This government promised to put learners at the heart of the process, but they seem to have been knocked over in the dash for skills and competitiveness."
But Jane Williams, director of the Department for Education and Skills improvement group, refuted the idea that colleges are being forced to choose between business and their local communities.
"It's not a choice we would expect the system to make," she said. "But some institutions will need to focus their intentions."
An ATL survey showed 86 per cent of lecturers believe colleges must teach skills sought by students, as well as those demanded by employers.
John Hayes, the Conservative FE spokesman, criticised Labour for being "fixated with the market" and said programmes should not focus solely on economic need.