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More than a third of jobs for new graduates are taken by people who have already had work experience with that employer, according to the latest update on the graduate jobs market.

The report from High Fliers Research shows that employers are recruiting more graduates - but there are record numbers of graduates chasing jobs.

Employers are reporting a 19% average increase in applications.

Those without any work experience have "little or no chance", says the report.

The Graduate Market in 2012 report, based on a survey of a hundred leading employers, reveals a recovering jobs market for graduates.

There will be 6% more graduate entry jobs for university leavers in 2012 than there were in 2011, suggests the research.

Job hunting

But this optimism is tempered by the increase in job-hunting graduates, with record numbers of university leavers competing with those who are still looking for jobs from previous years.

The research suggests that a third of job applicants for the current round of graduate entry posts are from previous cohorts.

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New graduates who've not had any work experience at all during their time at university have little hope of landing a well-paid job with a leading employer”

Martin Birchall High Fliers Research

The report also shows that job-seeking young people leaving university are at a disadvantage compared with their counterparts from a few years ago.

Despite signs of growth, graduate vacancies have still not recovered to the levels from before the financial crisis, says the research. And there are 50,000 more graduates leaving university this year compared with 2007.

Starting salaries have also remained stuck for three consecutive years, with a median figure of £29,000.

But the report highlights how many graduate jobs are being taken by young people who already have a connection with an employer, such as work experience during holidays or placements as part of a course.

Among investment banks, three-quarters of graduate jobs are taken by applicants who have already spent time with the company.

More than half the employers expect would-be recruits to have some kind of work experience, without which they are unlikely to be considered, regardless of their qualifications.

Martin Birchall, managing director of High Fliers Research, welcomed the increase in graduate vacancies.

But he said it was a "stark warning to the Class of 2012 that in a highly competitive graduate job market, new graduates who've not had any work experience at all during their time at university have little hope of landing a well-paid job with a leading employer".

18 May 2011 Last updated at 01:03 GMT

Graduate jobs market is 'tough competition'

By Sean Coughlan BBC News education correspondent

University leavers are making many more job applications than last year

Students leaving university this year are going to face intense competition for jobs - with a survey indicating a 33% increase in applications.

The High Fliers recruitment survey suggests students are applying more often and earlier for graduate jobs.

The survey was based on the experiences of almost 18,000 final-year students at 30 leading UK universities.

The study also indicates confidence is returning in the graduate jobs market after the gloom of the recession.

Students in the universities taking part are expected to send out a total of 343,000 applications - up by a third on last year and 75% compared with 2004.

And 40% expect to begin graduate jobs this year - compared with 36% last year, 25% expect to move on to postgraduate study, and 35% are planning to travel or take temporary or voluntary jobs or have not yet decided.

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Source: High Fliers UK Graduate Careers Survey 2011

For the first time in three years, graduates are expecting starting salaries to increase - and investment banking has once again become a popular careers option.

Public-sector jobs, a more attractive choice during the recession that followed the financial crisis of 2008, have less appeal for this year's university leavers - with applications dropping by a fifth.

While many students in Belfast and Glasgow intend to stay and work in those areas, the survey shows a strong pattern across England for new graduates to gravitate to London.

In 25 of the universities surveyed, London was the first-choice destination for jobs.

Martin Birchall, managing director of High Fliers Research, said: "During the worst of the recession, many of the country's brightest university-leavers opted out of job hunting and instead enrolled for further study or went travelling after graduating, in the hope that employment prospects would be better when they returned.

"Our latest survey of final years students shows that confidence in the graduate job market is finally improving."

Universities Minister David Willetts said: "I am pleased to see indications of increasing confidence in the graduate employment market.

"As this report demonstrates, graduates are rising to the challenge of a difficult market with a record number making early job applications. A degree remains a good investment and is one of the best pathways to achieving a good job and rewarding career.

"Improving information for prospective students about what they can expect at university and from their degrees is a key part of our future plans for higher education."