King says graduates should look beyond bonuses

Bank of England Governor Mervyn King has criticised large banks in the City for giving out excessive bonuses to employees.

Appearing before the Treasury Select Committee, Mr King said that too many graduates are lured to banking and finance jobs because of the high level of compensation.

He suggested that talented young people who are leaving university are drawn to the City because they see it as 'the only place to work in.'

'I do think it is rather unattractive that so many young people, when contemplating careers, look at the compensation packages available in the City and think that these dominate almost any other type of career,' Mr King commented.

He added that banks are 'paying the price' for handing out incentives that may encourage too much risk-taking.

However, Elspeth Farrar, Communications Director for the Association of Graduate Careers Advisory Services, recently advised graduates to not be deterred by the credit crunch and keep applying for finance jobs as usual.