A law raising the school leaving age to 18 in England will be included in the Queen's Speech on Tuesday.
The legislation would see more apprenticeship schemes created
The move aims to tackle the problem of young people leaving education without qualifications or workplace skills.
Schools Secretary Ed Balls told GMTV the "radical proposal" was needed because too many people were leaving school at 16 without qualifications.
Under the plans pupils would not have to continue with academic lessons but would be required to receive training.
'Skills to succeed'
Tuesday's address will announce the leaving age will be raised to 18 by 2015.
Around 90,000 new apprenticeship schemes will be created by 2013, which ministers say is a 60% increase.
The government has also pledged to create 44,000 more places at further education colleges.
Mr Balls said: "We need every young person to have the skills to succeed.
"We still have far too many people who are leaving school at 16 without qualifications and then either going into a job without training or often into no work or training at all.
He added: "The vast majority of countries have more people staying on than we do. That's got to change, and this is a radical proposal to make that happen."
The proposal means increasing the leaving age for the first time since 1972, when it was raised to the present 16 years old.
The most recent figures for England showed that 11% of 16 to 18-year-olds were still outside education, training or work.
Mr Balls said the new age limit would be enforced by a "robust regime" of support and penalties including spot fines and court action.
But the schools secretary added that, while there would be a "clear legal responsibility" to stay on post-16, there was no suggestion of using custodial sentences to enforce it.
In January, the government said it wanted to see all 16 to 18-year-olds remaining in education by 2013.