Last year, 157,000 15-year-olds failed to gain at least one GCSE of grade C or better, although the proportion has fallen from nearly 30 per cent in 19967 to 26 per cent last year.
In the North-east, Yorkshire and Humberside nearly a third failed to get a C or better, compared to just over one in five in the South-east.
These figures are not contained in the school performance tables which show that, despite ministers' target for improvement being met a year early, half of 15-year-olds fail to gain five or more good GCSEs.
Critics fear government plans for a new diploma for 19-year-olds, outlined in this week's Green Paper, will discourage low-achievers because the minimum requirement of five A*-C grade GCSEs or equivalent may be out of their reach.
Even by age 19, one in four young people fails to reach the required level and so would miss out on the new matriculation diploma.
Professor Alan Smithers of Liverpool University's Centre for Education and Employment Research, said: "The Green Paper won't meet these people's needs. If you know you're not going to reach the required level then it's not much of an incentive."
The Green Paper 14-19: extending opportunities, raising standards aims to persuade all young people to stay in education or training until 19 and to achieve higher standards through a wider variety of academic and vocational courses from age 14. At present, less than 75 per cent of 17-year-olds in the UK are in education, compared with about 95 per cent in Germany and Japan.
Education Secretary Estelle Morris wants to end the "snobbery" over vocational qualifications by giving them parity with academic awards. Pupils will be able concentrate on four core subjects - English, maths, information technology and science from 14 - and choose between school, college and workplace courses.
There will be a matriculation diploma - an overarching award for academic and vocational studies, extra-curricular activities and voluntary work - at three levels.
The Department for Education and Skills said: "These proposals are about raising standards. There are a lot of routes, vocational as well as academic. This will allow all young people to fulfil their potential."
Ms Morris said: "Pupils will have until they are 19 to achieve five A* - C or the equivalent. Teachers will be able to motivate them to carry on at school and improve their grades. Not getting five good grade GCSEs is a barrier to employment."
John Bangs, head of education at the National Union of Teachers, said:
"Ironically, a scheme aimed at inclusion could end up excluding pupils and achieving exactly the opposite."
Green Paper, 7-9 Leader, 20 FE Focus, 33