THE region is generating only 2.6 per cent of graduate jobs, compared with 40 per cent in London, a survey of blue-chip companies showed last night.

The figure means the region is recruiting the lowest number of graduates in England.

London and the South-East are fuelling the demand for graduates, generating the highest wages and the most jobs, according to the poll for the Association of Graduate Recruiters. The survey of 223 large employers showed that demand for graduates should continue to rise next year, with 82 per cent saying they expected to maintain or increase recruitment.

Average starting salaries for graduates rose by 3.4 per cent from last year's figure of £20,300.

Accountancy and law firms, together with investment banks, generated about 40 per cent of graduate vacancies, with engineering companies and retailers each contributing about eight per cent of the new posts.

The South-West of England generated 7.3 per cent of the vacancies, the North-West 6.5 per cent, Yorkshire 3.8 per cent, East Anglia 3.2 per cent and the North-East 2.6 per cent.

The survey found recruitment conditions in computing were recovering after several slow years in the wake of the dotcom crash.