BT axes graduate recruit scheme

The news comes as graduates face an increasingly tough job market

Telecoms giant BT has closed its graduate recruitment programme as it continues to cut costs in the downturn.

The firm said it had no plans to reopen the scheme, but added that it remained "committed to the 2009 intake", who are due to start in September.

The news will add to rising concern about youth unemployment. According to BBC calculations, the unemployment rate among 16 to 24 year olds stands at 19%.

In May, BT said it planned to cut about 15,000 jobs in 2009, mostly in the UK.

"In light of the current economic environment and headcount pressures, BT has taken the decision to cease graduate recruitment activity and are no longer running a graduate recruitment programme," a company spokesperson said.

"At the present time, there is no timeline for re-entry."

BT is the first major UK employer to formally close its graduate recruitment scheme since the recession began last year, says BBC business correspondent Joe Lynam.

Competition for jobs

It is important to look at this in context and to point out that few employers have abandoned their graduate recruitment programmes altogether Association of Graduate Recruiters

BT's graduate recruitment scheme has received a growing number of applicants in recent years.

Last year it received 4,800 applications for 130 jobs. The previous year it received 4,100.

The announcement will come as a blow to university leavers finishing for the summer and starting to look for jobs.

According to the Association of Graduate Recruiters (AGR), graduate jobs have been cut by one quarter this year and 48 graduates will compete for every job on offer.

However, commenting on BT's decision, the AGR said: "It is important to look at this in context and to point out that few employers have abandoned their graduate recruitment programmes altogether.

"Most are likely to reinstate recruitment levels at the first sign of an upturn in the economy."

'Lost generation'

BBC calculations based on ONS data show that in the 16-24 age range, about 928,000 people are classed as unemployed.

The total number of people out of work in the UK stands at 2.4 million.

Business Secretary Lord Mandelson has previously called on firms to help the government tackle youth unemployment and so avoid a generation "lost to work".

A spokesperson for the Department for Business, Innovation and Skills said: "The government is backing young Britain by offering a range of options including training, mentoring, work experience and up to 15,000 graduate level internships .

"We are also developing real help and support, talking to major employers about ensuring graduates get experience of work and a chance to show what they can do."