This is kind of the approach that Switzerland is taking (disclaimer; I'm Swiss), although I would not formulate it as drastically. It depends a bit on the region but school is required until 14-ish, after that there's a split for "gymnasium", which is continued full-time-school, around 20% of the students do this (again, varies by region). The remaining 80% start an "apprenticeship", where they work 40-60% on a job, and spend the rest of the time in school (where there's about a 50-50 split between general education and job-specific education). Whenever someone doing an apprenticeship figures out that he wants to go back towards higher education, there are plenty of routes to do so.

In my opinion it works quite nicely. The 80-20-split for gymnasium (which requires an entry-exam, but again, region-dependant) ensures a certain level for students in gymnasium, and the "job schools" for the apprenticeships allow for job-specific education. All in all, I consider it a pretty decent system.