More than 300,000 people graduate in the UK every year
This year will be the worst time to graduate in two decades, a survey of employers suggests.
The research is sure to spread gloom among students gearing up for their final exams.
We look at the key issues:
Is this the worst time ever for UK graduates?
The long term trend has been for growth in graduate-level employment, but there have been other bad spells.
Employment rates among graduates have generally grown over the past 30 years, but there were difficult times in the early 1980s, '90s and in 2002/3, according to Graduate Prospects, the commercial arm of the UK's Higher Education Careers Services Unit (Hecsu).
The latest study, from High Fliers Research, found recruitment targets among 100 top UK firms had been cut by 17% for this year.
Chief executive of Graduate Prospects and Hecsu Mike Hill says times are hard - but graduates have come through difficult times before - the most recent being the collapse of the dot.com boom in 2002/3.
Top finance tips for students
"Graduates should not panic. There are lots of jobs out there, but they will be harder to get because more people will be going for them.
"There are more jobs for graduates now than there were 10 years ago. The overall trend is up but there have always been ups and downs, " he said.
"A great many of those who graduated in the difficult times of 2002/3 have prospered. The proportion of graduates who go to the blue chip companies is only about 10%. The rest go out into other areas of the economy."
Will all areas be hard hit?
The High Fliers research showed that the crisis in the financial sector had immediately impacted on recruitment in that area - with graduate recruitment expected to halve this year.
WHERE GRADUATES WORK
Arts, design, media, sport - 6.4%
Business & financial - 8.7%
Commerical, industustrial & public sector managers
Education - 6.8%
Health - 13.5%
Other clerical & secretarial -9.7%
Retail, catering, - 8.7%
IT - 3.7%
Engineering - 3.4%
This has been a key growth area for graduates in recent years. The last published annual report on where graduates find work showed that business and financial sectors, plus personnel and recruitment saw the biggest increases. But overall, only 9% of graduates in 2007 went into the business and financial sectors in the last year for which there are figures.
The proportion going into the public sector, seen as a safer haven in recessionary times, is greater. A total of 13.5% of graduates from that year went into health and nearly 7% into education. 9.2% went to work as managers in commerce, industry and the public sectors.
What can students do if they are worried about their job prospects?
The best advice, it seems, is to take advice and widen horizons.
Mike Hill, the chief executive of the Higher Education Careers Services (Hecsu) says: "There are hundreds of different professions. People need to cast their nets wider, look at professions related to their field and take careers advice".
All universities have their own careers advisors.
Hecsu is the umbrella body for the service and publishes advice under its commercial website Prospects, with links to the various university careers services.
Top tips from these bodies include:
• Take advice
• Broaden your horizons to related professions
• Consider paid or unpaid work experience
• Do not be too proud to use contacts to get a first break
• Do not be too proud to take a job you think may be beneath you
• Be imaginative
• Consider setting up your own business
Nick Parfitt, of human resources consultancy Cubiks adds that graduates could consider opportunities overseas.
And they might also need to lower expectations and seek to gain experience in an area related to their chosen field. This would also show they were serious about a particular sector.
For example, a graduate could get a job in a finance department rather than on a graduate accountancy scheme - and then keep applying for graduate schemes
Is the government doing anything to help graduates find work?
Ministers have been talking to four top firms - including Barclays and Microsoft - about offering paid internships to students who have failed to find jobs. th
Universities Secretary John Denham is drawing up the plans. The aim is that internships will at least improve graduates' skills and experience and may in some cases lead to full-time work.
Are all employers cutting back?
Many individual recruiters are continuing with their graduate recruitment programmes. Lloyds TSB is one of those saying it will recruit just as many graduates this year as it did last year.
Jonathan Mayes, the company's head graduate recruitment manager, said: "We are taking the long-term view and believe in graduate recruitment because we are building our future leaders. It is a long-term investment."
Is it worth educating more graduates if the job market is already so bad?
Every year, more than 300,000 people graduate from UK universities. Ministers say it is crucial to increase the proportion of graduates and skilled workers, so that the UK is in the best position to move out of recession.
It is committed to having half of people educated to graduate level and to increasing skills generally to enable the UK to maintain competitiveness with the rest of the world. It has recently announced it is funding more apprenticeships.
How many graduates are left unemployed at the end of their studies now?
Of those who graduated in 2007, the latest year for which figures are available, 5.5% were believed to be unemployed six months later, according to the Higher Education Statistics Agency (Hesa).
What do students say?
The National Union of Students is warning students it will be hard to find a job.
The union's president Wes Streeting said: "We're all very acutely aware that the picture facing this year's graduates is very bleak.
"Our advice to students has been to start looking for jobs much earlier, to do their research and to recognise that it's going to be quite hard.
"We're also working with government and talking to businesses - we welcome the government's announcement of a potential graduate internship scheme which, by no means perfect, is at least doing something to tackle the picture facing graduates, and equipping them for what will be a very rough ride."
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