A shortage of well-trained graduates could hinder the growth of the Chinese economy and prevent it from developing more sophisticated industries, according to a report by consultants McKinsey.
The report also predicts that multinationals will have an increasingly hard time recruiting high-quality staff in China.
"It is a paradox of shortage among plenty," said Andrew Grant, director in McKinsey's Shanghai office and one of the report's authors. "Few of China's vast numbers of graduates are capable of working successfully in the services-export sector."
Fewer than 10 per cent of graduates in China have the skills to work for a foreign company, compared with 25 per cent of graduates in India, McKinsey estimate.
Meanwhile, China will need 75,000 managers with some form of global experience over the course of the next decade but currently has only about 5,000 such people.