Asian universities and secondary schools must better align themselves with labour market so they can ensure graduates have the skills and knowledge required by employers, says a new Asian Development Bank report, Improving Transitions: From School to University to Workplace.

An ADB statement about the report quotes Jouko Sarvi, Education Practice Leader in the bank's Regional and Sustainable Development Department, as saying: "œAsia's ability to compete in a globalised world depends on the readiness of students entering university, the employability of graduates in the labor market, and acceleration of innovation, science, and technology for creating new products and services."

The report shows Asia's students need to be better prepared for the rigors of higher learning, including problem solving and critical thinking needed in math and science studies.

It says the role of education in supporting human resource development is increasingly in the spotlight as more Asian countries move toward middle income status and demand grows for skilled labour to support higher economic growth.

"The misalignment between schools, universities and the job market is evident in regional employment trends," the ADB press release says.

It notes that in Mongolia, graduates of vocational training earn more than graduates of colleges and universities. In Thailand, where the education system "skews toward social science", 80 per cent of firms report difficulties in finding employees with adequate technical skills. Meanwhile, unemployment among graduates from top-tier universities in China stood at 10 per cent in 2008.

Looking at 15 countries in South Asia, Southeast Asia and East Asia, the report recommends diversifying higher education options being offered to students, in line with labour market needs. It also encourages partnerships with other institutions and the private sector to foster secondary education reform, and better prepare students for future employment.