Staff teaching business skills are hindered by out-of-date experience, and few take the opportunity to improve, say college inspectors.
A report into the standard of business, administration and management courses in further education colleges says a lack of recent experience is "the most common weakness in the staffing of business courses".
The Further Education Funding Council inspection report says: "Opportunities to update knowledge and skills are limited and, where they exist, few teachers take advantage of them." But inspectors indicate that part-time staff with recent experience are "invaluable" in maintaining standards.
The report, into the 620 business qualifications offered by colleges, says up-to-date experience is essential for staff in a rapidly changing world.
"The revolution in office technology has lessened the demand for traditional secretarial skills and increased the need for skills in information technology.
"The recession and technological advancement of the early 1990s have also altered the pattern of demand for labour in parts of the services sector. "
Some 61 per cent of lessons were above-average, but inspectors said in their report: "Much of the teaching on business courses is competent, if uninspiring.
"Teachers often fail to relate theory to modern business practice or to make good use of case studies that relate to local business."
And courses are criticised for falling "below acceptable business standards".
Many results were good, but inspectors warned that students' achievements across the programme area differ widely from college to college.
"There is a need for further analysis to explain why students who have similar backgrounds and levels of attainment when they start their courses achieve such widely differing results.
"There is also a need for the sector to identify and disseminate good practice within, and between, institutions."
Sue Berryman, negotiating secretary for lecturers' union NATFHE said the research supported fears that lecturers' pay rates could prevent experienced staff joining colleges.
But she said there was no research to show how pay compared between colleges and industry.