Graduates in debt `unable to find work`

By Matthew Plant – Financial specialist

In the three months to September, one in five unemployed 18-24-year-olds had a degree, according to new statistics obtained by the Liberal Democrats, meaning many of today`s graduates are unable to repay the debt they built up during their studies.

Graduates are still much less likely to be unemployed than those without degrees, but the rate of unemployment amongst degree-level graduates has increased faster than it has for young people with lower qualifications.

Since the start of the economic downturn, the unemployment rate for 18-24-year-olds has risen by 5.8% to 18%.

A debt expert at Think Money said: "Being unemployed can be very worrying for anyone, but for graduates with a large student debt, it can be particularly serious.

"It`s important to distinguish between the types of student debt, though. Student loans don`t need to be repaid unless the borrower is earning enough, but other debts taken on during studies - credit card debts or overdrafts, for example - aren`t tied to income in this way.

"Anyone struggling to repay their debts should seek expert debt advice at the first opportunity."

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