Graduates shouldn't let the economic downturn put them off job-hunting

Last summer, Sarah Tranter, 23, graduated from the University of Warwick with a first-class degree in international business but, despite that and despite being fluent in three foreign languages, she has not managed to find a job. Her experience is typical of graduates in today's desperate job market, even those with the best degrees from Britain's top universities.

"I've applied for more than 100 jobs in marketing, research, PR, sales and communications," she says. "I thought my languages would make me employable, but I've been shocked at how hard it's been. I'm now temping as a waitress and in admin, but even that has been tough to find. A lot of friends are now joining me on the job search who've been made redundant from grad schemes in the banking sector."

Tranter is considering leaving the country to find work abroad. "I feel I'm running out of options here," she says. "I'm looking at internships in Paris. I'm hoping the job situation will be easier."

Tranter's experience won't make easy reading for final-year students who are still flocking to campus recruitment fairs hoping to land that big job. Jobs, as a survey found last week, are drying up. Firms such as HSBC, Marks and Spencer, Morgan Stanley and Rolls-Royce have cut their graduate intake by nearly a fifth. In the City, graduate jobs have been culled by 47 per cent. Several investment banks are reported to be limiting their focus to a handful of institutions, such as Oxford, Cambridge and Imperial College.

The big banks' recruitment websites tell a story of business as usual. But several leading investment banks reveal that they have already fulfilled their requirements. Manufacturing industry has also whittled down its graduate recruitment. Heinz, for example, has disbanded its 2009 graduate scheme.

But it is not all gloom. Industries such as accountancy, teaching, the NHS, law and the uniformed services such as the police and armed services are seeing much higher levels of interest and are continuing to recruit.

"The value attributed to job security by students is higher than I've seen before," says Sarah Shillingford, graduate recruitment partner at the accountancy firm Deloitte. "Since other UK recruiters have cut back, we've seen a 12 per cent increase in applicants. We've also already filled a lot more vacancies than we had this time last year."

Law firms, with starting salaries averaging £37,400, are particularly popular. As they offer training contracts to students several years before they qualify, they can afford to keep hiring. "We are planning to recruit the same number this year as last, but are expecting more applications, as people who would have applied to banks and other sectors turn to law firms," says Gemma Abbott of Freshfields.

Some experts are more positive. Carl Gilleard, chief executive of the Association of Graduate Recruiters, doesn't deny that there are fewer opportunities around, but believes firms will not shut down recruitment entirely.

"There are fewer graduate jobs, more graduates and more applications," he says. "But there are lessons to be learnt from the last recession in 1991. Graduate vacancies fell by 32 per cent. Employers now are not losing sight of the benefits of investing in graduate talent."

Yet graduates will still have to be more flexible, according to Anne-Marie Martin, director of the Careers Group at the University of London. "Nobody says, 'I want to work for an insolvency firm,' but those are the kind of positions on offer. Students need to be creative. Some of the big accountancy firms have filled their London-based 2009 graduate jobs, but there are still jobs in places like Uxbridge, Milton Keynes and Luton."

Students who believe that their degree should lead to a guaranteed job are getting a fast wake-up call. Nick, 26, struggled to find work despite having three degrees, including a First in English literature from University College London, a Masters in film production from the University of Southern California and an MA in creative writing and screenwriting from the University of East Anglia.

"I was applying for jobs in advertising, but as the rejections mounted, I branched out to other media and PR. I applied for about 500 jobs, including 25 graduate schemes, without success."

Nick eventually won a position at a PR firm, but he feels bitter at employers' lack of interest in his education, and advises new graduates to focus on work experience. "Education doesn't get you anywhere. It doesn't matter where you studied or what you came out with. It would have been far more useful for me to have been 21 again, and willing to work for free to get experience. At 26, with the expense of all that education, that just wasn't an option."

Anne-Marie Martin agrees that experience is everything. "Some students are considering travelling or doing a postgraduate qualification, but the recession could still be in full swing this time next year. They could be saddled with extra debt and find even fewer jobs around. Graduates should try to find work this year."