Learning a new language should be compulsory for pupils up to the age of 16, according to a new report highlighting the UK’s recent abysmal record in encouraging young people to study languages other than English.

The report published by the Higher Education Policy Institute (Hepi) cites an EU-wide survey showing that just 32% of young people in the UK say they are able to read or write in more than one language, compared with 79% of their peers in France and more than 90% in Germany.

The report calls for the overturning of the government’s 2004 decision to drop compulsory study of languages at key stage four – when pupils take GCSE exams in England, Wales and Northern Ireland – which has led to a steep decline in the numbers in England going on to study languages at colleges and universities.

It also recommends that the government should start subsidising the teaching of languages at universities, “in light of declining enrolments and growing vulnerability for lesser taught languages”, for strategic and cultural reasons.

“It was a big mistake to scrap compulsory foreign languages at GCSE,” said Megan Bowler, the report’s author. “Rather than continuing to present languages as not suitable for everyone, we need to include a broader range of pupils learning through a variety of qualifications geared to different needs.

“Given the shortage of language skills in the workforce, we should safeguard higher education language courses, particularly those involving less widely-taught languages, and prioritise extra-curricular language learning opportunities.”

Fewer than half of all pupils in England, Wales and Northern Ireland sit a GCSE foreign language exam, compared with three in four in 2002 when study was compulsory. The report notes that GCSE entries in German have fallen by 67% since 2002, while French entries have dropped by 62%.

The British Academy said it supported the report’s recommendations, which match many of its own concerns.

“With Brexit just around the corner, we need linguists more than ever. Languages are vital for effective trade, diplomacy and soft power, for social cohesion, social mobility, and educational attainment, all of which will be essential to the UK’s future success,” said Neil Kenny, languages lead at the British Academy.

Nick Hillman, Hepi’s director, said making foreign languages optional at GCSE was one of the worst education policy blunders in recent memory, and that reinstating them was a “no-brainer”.

“In terms of speaking foreign languages [the British] have never been good. But now the level has gone from low to dire,” Hillman said.

The report suggests that GCSEs in England be supplemented by less academic alternative qualifications, including one for vocational language use and another for the study of community languages, available up to the end of the sixth form.

A symptom of the decline has been a shortage of teachers, with the report recommending that language teachers be added to the Home Office’s shortage occupation list, to help recruit teaching staff from overseas. Currently only Mandarin teachers are on the list.

The report notes that the devolved school systems in Wales and Scotland have had more success in encouraging the study of languages than England’s, especially in primary schools.