£40,000 A Year As Firms Bid For The Best

Companies will pay whatever it takes to capture and hold on to the right person.

Britain' s brightest graduates still start work next year on salaries of £ 40,000 or more -almost double the national average pay- according to a report out tomorrow.

The study, by the Association of Graduate Recruiters (AGR) which represents more than 600 employers, will disclose that fierce competition is forcing companies into "bidding wars" for the most talented university leavers, pushing up starting salaries by well above the rate of inflation.

The result, says the association, is that the typical graduate starting salary will top £ i20,000 within the next 12 months. Outstanding university leavers will receive double that amount. There is also anecdotal evidence of at least one individual receiving more than £ 50,000 to start work.

Many graduates will also receive a "golden hello" of up to £ 11,000 in addition to other perks including company cars and private healthcare. Some firms are even giving money to recruits to buy clothes, allowing them to swap the jeans and T-shirts of their student years for business suits.

One of the chief executives of AGR, which represents employers such as ICI, Rolls-Royce, Proctor and Gamble and several of the big accountancy firms, said that the rise in salaries indicated that bright students could still prosper despite the economic uncertainty affecting the country.