A leading think tank has slammed New Zealand's education system for producing disadvantaged youth who are worse off than in any other developed country.

The business-backed New Zealand Institute, which has focused until now on economic policy, says the education system has lost sight of the need to keep young people engaged in school and transition successfully into work.

It recommends radical reforms including widespread use of computer-based e-learning, putting students on to pathways to work from the first year of intermediate school (Year 7), giving employers more input into what schools teach and giving all students career advice through school years and support after leaving school.

Secondary Principals Association president Patrick Walsh agreed that there was a huge gap in strategic leadership, with each section of the Ministry of Education working "in silos".

He pointed to a State Services Commission audit last month that rated the ministry as weak on strategic leadership, Maori achievement and the transition from secondary to tertiary education.

The NZ Institute report finds that "disadvantaged youth in New Zealand are more disadvantaged than youth in other OECD countries, that poor youth outcomes are concentrated in Maori and Pacific groups, and that the situation is not improving".

However, New Zealand is fourth-best in the 30-nation OECD group for reading, numeracy and scientific reasoning of 15-year-olds. But we are the worst in the OECD for the number of young people who drop out of school early and become unemployed. By age 16, 36 per cent of students say they are usually or always bored with school, and a quarter have either left school or want to leave as soon as possible.

The report says most developed countries keep young people in education or training until they turn 20, with those aged 15 to 19 comprising less than 3 per cent of the total workforce in half of the countries.

But in New Zealand those aged 15 to 19 comprise 7 per cent of the would-be workforce and 27 per cent of the country's total unemployed - a bigger share of the unemployed than in any other developed nation.

The institute believes e-learning can reduce boredom by giving students personal links with teachers and global audiences for their work. At Auckland's decile 1 Pt England School, with 93 per cent Maori and Pacific students, Mubasshira Mehter's blog has been viewed by 17,452 people in 125 countries.

"People can see our work and what we've been doing around our school," said Mubasshira, who is 12.

Five local primary schools have joined Tamaki Intermediate and Tamaki College in the Manaiakalani ("Hook from Heaven") Trust, which carries the credit risk for parents to buy $400 notebook computers for their children at $15 a month for three years, including an internet connection and technical support.

Pt England principal Russell Burt said the schools used new media as "the hook of engaging students".

Full report:
* nzinstitute.org
* manaiakalani.org
4th BEST in OECD, reading and maths scores
7th WORST Teen birth rate
4th WORST Death rate aged 15-24
WORST Youth share of unemployment
WORST Cannabis use
WORST Youth suicide

Proposed solutions:
* E-learning to engage bored students.
* Pathways to work starting in Year 7.
* Match education to economy's needs.
* Connect schools with employers.
* Career guidance and transition support for all students.