The poorly educated are paying the highest price for the financial crisis, says the OECD's education adviser, Andreas Schleicher.
Youngsters without qualifications now face a shrinking chance of getting jobs, according to the economic think tank's annual review of education.
For the UK, the OECD warns of the "significant" numbers of youngsters outside of education, work or training.
This is the "biggest challenge" for the UK, says Mr Schleicher.
According to the OECD's figures for 2011, people aged between 15 and 29 in the UK spend on average 2.3 years unemployed, compared with 1.7 years in Germany and 1.1 years in the Netherlands.
The report warns that too many youngsters in the UK drop out of education and are left without skills needed to get jobs.
Widening gapThe OECD's annual report describes how the financial downturn has widened the economic gap between those with and without a good level of qualifications.
The jobs market has become tougher across the developed world, but levels of unemployment are now three times higher among the poorly qualified, such as those with the equivalent of less than five good GCSEs.
There has always been an earnings gap between graduates and those less well qualified, but the OECD says that this widened even further between 2009 and 2011.
The labour market shows no sign of being overloaded with graduates, Mr Schleicher says. Instead it is the unskilled jobs that have been disappearing, leaving those without qualifications vulnerable to unemployment.
In the UK, the report highlights a particularly exaggerated gap. At the upper end of qualifications, the UK has one of the highest graduation rates in the developed world.
But at the other end of the skills scale, there are a disproportionately large number of youngsters leaving education with few qualifications and diminishing chances of regular work.
Smoke signalsThese figures for 2011, show that in the UK almost a quarter of those who failed to achieve basic secondary qualifications ended up in the so-called Neet category - not in education, employment or training.
For those who have five good GCSEs or their equivalent, there is a much lower level of people who are NEET, at 14%.
The report highlights that the UK has one of the lowest percentages of 16 to 19 year olds in education among industrialised OECD countries.
This could change with the raising of the leaving age to 18. But Mr Schleicher warned that it was not enough to keep people in education, they needed to be given skills that could get them jobs.
The costs of a bad education are not only economic, says the report.
There are also health implications. A person with a degree is half as likely to be obese as someone without secondary school qualifications, says the survey.
The poorest educated are most likely to smoke. Graduates are the least likely to smoke - and this is particularly the case in the UK, where graduates have among the lowest levels of smoking in the developed world.
But the UK is at the unhealthiest end of the scale for obesity. A person from the UK without secondary school qualifications is more likely to be obese than anywhere else in the OECD.
Nicola Dandridge, chief executive of Universities UK, welcomed the report's evidence of the economic and social benefits of higher education..
"The report is clear that investing in higher education pays off in the long term, both for individuals and society."
The CBI warned of the need to improve vocational skills in the UK to make young people more employable.
"We need to end ingrained snobbishness about technical education," said Neil Carberry, the CBI's director of employment and skills.
"We're facing a critical lack of skills which risks holding back our long-term growth. UK competitiveness relies on a highly skilled workforce, so we cannot afford to waste talent."
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