Sir Michael Wilshaw said there were worrying signs over Photograph: Dominic Lipinski/PA

Sir Michael Wilshaw, the outgoing chief inspector of schools in England, warned that the country faces a widening “skills gap” that threatens its economic prosperity.

Wilshaw said that while schools continued to improve – with 90% of primaries and 78% of secondaries rated good or outstanding – there were worrying signs over teacher shortages and in further education for young adults.

“The country is facing serious knowledge and skills gaps that threaten the competitiveness of our economy,” Wilshaw said, in unveiling Ofsted’s 2015-16 annual report.

“The decision to leave the European Union has thrown this issue into even sharper relief. As a nation, we can either intervene to inject the system with the vision, skills and energy it needs, or we can be content with the status quo and the consequences of our failure to improve the quality and status of technical education over many years.”

The proportion of further education colleges rated as good or better had declined from 77% to 71% over the course of the year.

“Many further education colleges are facing a period of continued turmoil while the quality of apprenticeship programmes remains patchy,” Wilshaw said.

Wilshaw noted that 1.8 million more children were now attending good or outstanding schools in England compared with August 2010, saying there had been “significant improvements even over the five years that I have been chief inspector”.

“Our schools have also become great forces for social cohesion. We forget what an incredible achievement this is. Whatever cultural tensions exist outside of school, race and religion are not barriers within them,” said Wilshaw , whose term at Ofsted included the Trojan Horse scandal over religious influence in schools in Birmingham.