University-industry collaboration patterns in more advanced economies have greatly impacted expectations for higher educational systems in developing countries. In Saudi Arabia, generally poor innovation performance of domestic industry has been perceived as a constraint in global competitiveness. The purpose of this study was to determine if there were differences among employers, and university academicians on their perceptions of the importance of skills and competencies that are needed by graduates seeking entry-level employment. The results suggest that a lack of efficient direct mechanisms to encourage university-industry collaboration has given rise to large disparities in the ability of individual institutions to interface with the corporate sector. This study found that there is vital need of soft skill development in the future graduates. Moreover, students need to be exposed to service-learning concepts. The service-learning projects should be incorporated in all the courses.