Competition for internships has intensified sharply as graduate job prospects remain constrained, according to a recent survey of major employers. Applications for summer internships rose 27 percent between 2024 and 2025, even as the number of internships offered declined by 8 percent, resulting in approximately 102 applications per available position, the Institute of Student Employers (ISE) reported.

Undergraduate work placements, typically completed during the academic term as part of degree curricula, also saw a 15 percent increase in applications. The ISE described this trend as evidence that competition for early career opportunities is mounting, creating significant pressure for students earlier in their education.

Employers highlighted the growing importance of internships and work experience in developing skills that artificial intelligence and automated recruitment processes cannot easily replicate. These include professional behaviour, adaptability, judgment, and awareness, which are increasingly sought after in the evolving job market.

The findings come shortly after political calls to narrow the divide between education and employment as a way to tackle youth unemployment. Amid these efforts, employers acknowledge the challenges involved in meeting rising demand for internships while also expanding apprenticeships and work experience programs for school-age participants, said Stephen Isherwood, joint chief executive of the ISE.

Students, facing intense competition, are eager for in-person contact with employers to distinguish themselves. Jon Cardoso-Silva, an associate professor at the London School of Economics, noted that many first-year undergraduates begin refining their resumes before starting university in order to secure “spring week” placements—short internships that often lead to more substantial offers at financial firms.

Data from the ISE also underscored the broader challenges in graduate recruitment. Employers in London received over 170 applications per graduate vacancy during 2025-26, with nearly two-thirds reporting increased applications for jobs targeting school and college leavers. To manage application volumes, almost 40 percent of employers said they are engaging students earlier through work experience programs, while others have raised eligibility criteria, limited application numbers, or adopted artificial intelligence tools to screen candidates.

Despite these pressures, the survey revealed little growth in overall graduate hiring among large employers, showing a negligible 0.8 percent increase, and no change for a typical employer. Indicators that include smaller firms paint a more pessimistic picture: job postings for graduates on a leading employment website remain roughly 13 percent lower than the previous year and about 20 percent below pre-pandemic levels in 2019.

This data points to a persistently tight labor market for new graduates, as they navigate a recruitment landscape growing more competitive and reliant on technology. Internships and early career placements continue to represent critical stepping stones amid these conditions.