The literacy gap between young people who are jobless and out of education and their working peers is bigger in the UK than in many other developed nations.
Young people who are considered "Neet" – not in education, employment and training – are also lagging far behind in their problem solving skills, according to a new study by the Organisation for Economic Co-operation and Development (OECD).
It puts the UK in last place out of 22 countries in terms of the literacy gap, and last out of 19 in terms of the gap in problem-solving abilities.
This is behind nations including Japan, South Korea, Italy, Spain and Germany.
The OECD's research uses data from the organisation's 2012 Survey of Adult Skills to look at young people's basic skills levels and their chances in the job market.
It concludes that young people in the UK can face difficulties moving from school into work, and those that have low abilities in areas such as literacy and a low level of education face more problems.
The gulf in literacy and problem solving skills between Neets aged 16 to 29 and their employed peers is the largest out of all the countries covered by the 2012 survey, the OECD found.
Overall, there was a 12.6 per cent gap in literacy, double the OECD average of 6.5 per cent. In comparison, in Japan, the difference was 0.3 per cent, in Korea it was 0.4 per cent and in Norway, which had the next biggest gap after the UK, it was 11.2 per cent.
There was also a 9.6 per cent difference between the problem solving skills of UK Neets and working young people. The country with the next biggest gap was the Netherlands, where the difference was 8.6 per cent, followed by Norway with a gap of 7.4 per cent. At the other end of the scale, in South Korea the difference in problem-solving skills was 1.2 per cent.
A country note on the UK does say that the Neet rate did not increase in the UK during the global economic and financial crisis, whereas it did in many other OECD countries.
But it also warns: "Many of the NEETs are far from the labour market not only due to their low skills but also because they are not looking for a job and thus may have fallen under the radar of education and labour market institutions."
Ensuring that all young people leave education with decent skills is a priority, the country note concludes.
It suggests: "Policies should focus on helping the NEETs, including those that have become disengaged, to renew with education or integrate into the labour market."
One in eight young people in England is not in education, work or training, according to government figures published last week.
Earlier this year, an influential group of MPs warned that tens of thousands of teenagers have fallen off the radar with no information available on whether they are in education or training.
The Commons Public Accounts committee said that councils and the Government must do more to identify youngsters that simply disappear from view.
A Department for Education spokesman said: "Following years of stagnation in international education league tables, this Government's relentless focus on standards is ensuring that thousands more young people are able to read, write and add up properly."
He added that there is no room for complacency, saying: "We will continue to build on this success by ensuring all young people leave school with the knowledge and skills they need to compete with their peers from across the globe."