Institutions of higher education, among other duties and responsibilities, prepare students to enter the labour market. The aim of this paper is to determine the extent to which higher education prepares students for the foreordained transition from the educational system to the labour market. The research was conducted in the form of a survey by which the students of the final years of the professional undergraduate study Management and the graduate professional study Management at the College of Slavonski Brod carried out a self-assessment of their knowledge, skills and competencies. To present and elaborate prerequisites of education as preparation for the labour market, characteristics of the labour markets and employment policy measures as well as knowledge, skills and competencies that are required on today's labour market and for the purpose of conducting this research, the following scientific methods were used: analysis and synthesis, historical method, comparative method, induction and deduction and statistical method. Results of this research indicate; if the students in the final years, of both, the undergraduate study and the graduate study, have the necessary knowledge, skills and competences that employers require of their employees, then students will consider themselves more prepared to find a job. In that regard, it is expected that each higher education institution provides students with the necessary knowledge, skills and competences i.e. those that enable students to cope well with the challenges of the labour market.