The organisation's Senior Policy Adviser, Alex Jackman, also told the cross-party committee, which is examining issues surrounding youth unemployment, that Government should widen the eligibility criteria for certain youth training schemes and make them less restrictive to small businesses.
He told the Committee, which was chaired by Harriett Baldwin MP, that training providers have to be encouraged to work more closely with small and even micro businesses rather than seek easier wins at large corporations, as is often the case now.
"Employers are the number one consumer of the products of education, and they are rejecting school leavers because their standards are too low," said Mr Jackman. "We are not referring to standards of academic education in this instance, but the more basic work skills all new starters should at that point in their lives already have drilled in to them. Things like being punctual, being able to deal with difficult customers or answering the phone politely.
"We believe, and so do our members, that schools should be doing more of this type of preparation work, possibly taught as part of a life skills class. This would not be difficult for schools to accomplish, but for a small business, teaching new starters this on a one-to-one basis is labour intensive and therefore costly.
"We are calling for the education system to engage employers more to achieve these aims, so they can learn exactly the types of skills pupils are lacking, and also to better prepare youngsters for the world of work," he added.
He also told the Committee that small businesses would welcome a widening and simplification of the employer incentives available to them.
"The problem for small firms currently is that there is no single tool to help find what they are actually eligible to apply for. NI holidays for firms are regional, and depend on the age of the employee and the business itself. There are other schemes too such as apprenticeship grants which come with stringent terms. Essentially let's cut out the hoop-jumping process and streamline it for businesses that simply haven't got the time to do endless research.
"A single system where a firm can type in their basic details and in return are offered a list of suitable schemes would be a huge help here."
There is evidence to suggest disproportionately low engagement with micro businesses by contract providers under the Government's new Work Programme.
"While it's easier for providers to approach larger businesses as there is more chance of success with less effort – more bang for your buck with the possibility of more potential employees – this means there's a massive and relatively untapped market of micro business employment opportunities."