UK universities must make the development of students' entrepreneurial skills a core part of degree courses, or they will lose out to international competition, according to a new report.

The joint report from the Council for Industry and Higher Education (CIHE) and the National Endowment for Science, Technology and the Arts (Nesta) says that 11 per cent of UK students are engaged in entrepreneurship education - most of which is taught through business schools.

It calls on universities to make sure all degrees in a wide range of disciplines provide students with the skills they need to find a job, by embedding entrepreneurship education into degree programmes rather than simply tagging it on to courses.

"Many vice-chancellors believe that they have already introduced it in their institutions; in reality it rarely enjoys the same status as research or the pursuit of academic excellence," the report says.

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Universities should also ensure that entrepreneurialism is embedded in all levels of the university, from student involvement in student societies to the vice-chancellor's overarching strategy for the institution.

"Universities must lead the way in transforming how higher education prepares the UK's workforce for its future economy," said Jonathan Kestenbaum, chief executive of Nesta. "Universities will be challenged by those paying fees, by the taxpayer and by the Government to be able to tell a compelling story of how universities continue to make the pioneering contribution to the economy and to society that they have made in previous generations.

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"As the economy presents new demands, universities have been able to respond. Universities are going to have to do the same again," he added.

Keith Herrmann, deputy chief executive of the CIHE, said pure business skills were no longer sufficient to mark graduates out in the workplace and universities must act now to provide their students with the training they needed. "Until now there has been much activity by a host of keen individuals but their work has been largely on the margins of the university, too dependent on short-term funding and inherently fragile," he said.

The report, Developing Entrepreneurial Graduates, recommends that universities should involve businesses and social entrepreneurs in the provision of training in entrepreneurship.

Tim Barnes, executive director of UCL Advances (which promotes entrepreneurialism across University College London), welcomed the emphasis the report put on the issue.

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"This is important because it's part of how universities should deliver on what they're here to do: teaching and research," he said. "It's about teaching students what they need to know to get the jobs they want to get. It's about how universities connect with society so the best of their research gets out into the wider world."

But although the report highlights international examples of best practice, Mr Barnes said it failed to celebrate how much work was already being done by universities in the UK. "I am concerned that it appears to paint a picture that this is all news to universities when it's not. There are a lot of really good things in the UK that are happening already," he said.

hannah.fearn@tsleducation.com.