Only 60% of former students find work in the first twelve months after leaving further education, a leading graduate careers website reports.
According to a major survey of nearly a quarter of a million students published by the Higher Education Careers Services Unit, over 21,000 graduates remain unemployed after a year - a higher rate than the national average; while many had continued with their studies or gone into training.
The survey by Graduates.co.uk also found an increase in the number of graduates abandoning highly competitive job markets and taking the step into self-employment. Although the number of former students becoming self-employed remained relatively low at 5%, the figure represents a substantial increase over recent years.
"The number of graduates looking to become self-employed doesn't really surprise me," said Adam Grunwerg from Graduates.co.uk , "It's so much harder to get a good graduate job nowadays, especially with the increase in assessment centres, pre-interviews and tests in what has become a highly competitive market."
The migration of the majority of graduate vacancies to London also contributes to joblessness and the increase in self-employment amongst former students.
"The 'Dragons Den' culture of TV programmes and government initiatives such as start-up loans has lowered the barriers to entry for starting a business," said Adam, "In fact, we might have to start adding new words like 'gradpreneur' to the dictionary."
"Hard times tend to bring out the best in people, and a market of well-motivated graduates bodes well for the future."
"I hope this trend continues because the more young start-up businesses we have, the lower the barriers to entry for students it becomes."
What are graduates doing now?
In employment - 61.8%
Self-employed - 5%
Unemployed - 8.6%
Working and studying - 8.4%
Still in further education - 13.1%
