Proposals to keep young people in school, training or workplace training until the age of 18 are expected to be unveiled in Spring.

It will mean the creation of around 330,000 new education and training places.

The government plans to raise the school leaving age in England by 2013 - meaning that next year's secondary school intake of 10-year-olds would be the first to be affected.

The proposals will not mean that students must stay in the classroom, but they will have to continue with training.

Under the plans, 16 and 17-year-olds would face three choices: stay on at school, studying for a Level 3 qualification; go to a further education college to study a full-time vocational course; or take the employment route, but with a guaranteed minimum level of training, such as an apprenticeship.

The proposals aim to tackle the problem of young people leaving education without qualifications or workplace skills and the reduction in available unskilled jobs.

The number of unskilled jobs has dropped from 8 million in the 1960s to 3.5 million today. The Leitch Review, published last month, predicted that the number of unskilled jobs would drop to only 600,000 by 2020.