Toll of jobless graduates soars to highest level for two decades

One in 11 people who left university last year were without a job six months later, a study by the Higher Education Careers Services Unit (HECSU) has found.

About 21,000 graduates – 8.9 per cent of university leavers – failed to find jobs as companies struggled to recover from the country's economic crisis.

The unit said it was the highest graduate unemployment rate since the last recession, when the level soared to almost 12 per cent in 1992-93.

And students have been warned more pain could be on the way, as planned budget cuts in the public sector threaten to have a lasting impact on the jobs market.

HECSU deputy research director Charlie Ball said: "Graduate unemployment hasn't risen as high as we feared and is some way off the levels of the last recession in 1992, when it reached 11 per cent.

"Prospects for graduates in the short term look brighter, with unemployment, as a result of the downturn, likely to have peaked and next year we expect to see a decline.

"However, with the anticipated public sector job cuts the future in the medium term looks less clear."

The research, called What Do Graduates Do?, relies on data collected by the Higher Education Statistics Agency, which surveyed 82 per cent of last year's graduates to find who was employed, in further study, or out of work.

The results suggest that the public sector was one of the few areas to weather the slump and continue to recruit university leavers, but this trend could end with the coalition Government's plans to reduce the deficit.

About 490,000 public sector jobs are likely to be lost in the next four years, the Office of Budget Responsibility has estimated.

The HECSU study, published in collaboration with the Association of Graduate Careers Advisory Services, shows the proportion of information technology graduates who remained unemployed rose to 16.3 per cent.

Engineering and building management subjects were also hit hard as unemployment rates among architecture graduates rose to 10.9 per cent, civil engineering to 11.9 per cent and electrical and electronic engineering to 13.3 per cent.

There was better news for graduates looking for work in retail and marketing, while university leavers with degrees in psychology, geography and law also fared well.

The proportion of psychology graduates who were out of work was 8.3 per cent – below the national average – and the rates for geography (7.4 per cent) and law (6.3 per cent) were even lower.

The health professional and social and welfare sectors increased their graduate intake, but there was a drop in the proportion of students gaining employment as education professionals.

Average salaries rose only gradually, and well below the rate of inflation, from 19,677 to 19,695.

The president of the National Union of Students, Aaron Porter, said: "These latest figures show that students are graduating from university into the bleakest employment market for decades.

"This is yet further proof that the radical proposals in Lord Browne's review to remove Government funding for the majority of subjects, and simply to transfer this cost to students is unfair and illogical."

DEMAND INCREASING FOR NEW WORKERS

Employer demand for new workers has increased but more jobseekers are chasing vacancies and pay rates are falling, according to a new study.

Recruitment firm Reed said its job index, which tracks the number of posts on offer, reached its highest level in almost a year, with a "steady return" to demand across the private sector.

Job demand was higher in every region of the UK and was particularly strong in the West Midlands and the South East.

Martin Warnes, managing director of reed.co.uk, said: "Job demand across the country is at the strongest level we have ever recorded, a full seven per cent higher than when the index began last December.

"Although salaries continue to slip downwards as applicant levels reach record highs, the threat of an imminent economic double-dip certainly seems to be receding which is great news for jobseekers."